The New Year has so far proven interesting for Crypto as a whole. Coming out of 2022 many are glad to be seeing the end of last year as the market trends for many assets related to crypto games and Web3 experienced a downward trend.
Momentum from 2020 and 2021 had been lost as the world returned to normality and with recent recession talks, investors have swayed away from less risky investments such as Crypto. Even the stock market has proven to be going through similar conditions as most industries have been left in a rut.
© Vladimirribakov
So far in 2023
Crypto tokens such as Bitcoin ($BTC), Solana ($SOL) and Gala Games ($GALA) have experienced some notable gains. Whilst spot trading has experienced gains a fairly unusual uptrend has been experienced from Crypto mining ETFs.
ETFs or Exchange Traded Funds are funds of stocks and in our case blockchain list related names that are placed into a fund for one lump sum. They help you have investments in multiple entities without the need for individual management. If something does not perform too well in said fund, you will be cushioned by other companies, tokens etc.
Specifically Bitcoin Mining ETFs have topped both the standard ETF markets and the leveraged equity markets. When looking at global markets, ETFs associated with Crypto were actually the worst performing ETFs last year. Countries like Australia and the United States Of America had these trends in 2022.
ETF.com has recorded that the bottom 4 ETFs in the United States were again Crypto.
Which fund has paved the way?
The ETF that has managed to scramble its way to the top is the Valkyrie’s Bitcoin Miners ETF (WGMI). This fund is actively managed on the NASDAQ and they invest in public companies within the Bitcoin mining sector.
WGMI is a fairly new fund as it was listed back in February of 2022 for investors to add to their portfolio. Furthermore this fund is actually environmentally friendly as the mining companies that are featured are included based on their energy efficiency.
Mining is not the most energy efficient method of obtaining Cryptocurrencies. Countries like China have heavily regulated it due to the carbon emissions that are emitted.
Valkriyie’s ETF is focusing on 20 companies. Some of them include:
- ADVANCED MICRO DEVICES INC
- ARGO BLOCKCHAIN PLC
- CLEANSPARK INC
- DIGIHOST TECHNOLOGY INC
- HIVE BLOCKCHAIN TECHNOLOGIES
- INTEL CORP
These companies make 50% of their revenue and/or profits from Bitcoin mining with the funds being made up of 80% of securities of said companies. The 20% that remains goes strictly into Bitcoin investments, exclusively.
Currently WGMI has a 40% YTD return which is great considering the Crypto winter we have experienced. Matched with the yearly average returns of 7-9% of the Stock Market, this fund is one to watch as 2023 progresses.
Crypto’s history with the stock market
As mentioned this is a fairly new fund. However Crypto has a history with the stock market that dates back to 2020 after the initial mainstream boom in popularity.
ProShares Bitcoin Strategy ETF was the first approved ETF within the U.S and experienced $1 billion in trading when it went live.
For those looking for a more stress free and diversified approach to Crypto investing, ETFs could be the route for you.
It is important you have a thorough understanding of Crypto assets and the NFT marketplace before investing capital. Your own research past this article is important due to the market’s volatility.
Happy investing!
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