August 30, 2018 08:36:26
Morgan Creek Digital, an asset management firm backed by multi-billion dollar investment advisor Morgan Creek Capital Management, launched on Tuesday a cryptocurrency investment fund in partnership with Bitwise Asset Management.
The Digital Asset Index Fund will give accredited investors a way to gain exposure to 10 of the largest cryptocurrencies by market value. The minimum investment is $50,000, the fund’s website states.
“Every investor should be considering an allocation to digital assets right now,” Morgan Creek CIO Mark Yusko was quoted as saying in a press release. “Increasingly, institutional investors are coming to us asking for exposure to the space. We wanted to create a vehicle tailored for those investors.”
Morgan Creek and Bitwise further explained that cryptocurrencies must pass rigorous, rules-based eligibility requirements, including custody qualifications, trade concentration limits and pre-mine restrictions to qualify for inclusion. All the assets are said to be kept in 100% cold storage and audited annually.
At launch, the fund features Bitcoin (BTC), Ethereum (ETH), Bitcoin Cash (BCH), Ethereum Classic (ETC), Dash (DASH), Litecoin (LTC), Monero (XMR), EOS (EOS) and OmiseGO (OMG).
Notably missing from the list of supported assets are Ripple’s XRP, Tron (TRX), Stellar (XLM) and NEO (NEO), as Morgan Creek has opted to exclude any cryptocurrency with more than a 30% pre-mine.
“If there’s a central party that owns 30% or more of supply, then we withhold those from the index,”
“If there’s a central party that owns 30% or more of supply, then we withhold those from the index,” Morgan Creek Digital partner Anthony Pompliano said, as quoted by Forbes. “Because we think that introduces a lot of additional risk that may not be there if it was a more decentralized network.”
US government officials argued earlier this year that altcoins such as Ethereum and XRP could likely be considered unregistered securities based on their token pre-sales. The US Securities and Exchange Commission (SEC) has since ruled that neither Bitcoin nor Ethereum were to be classified as a security. However, the regulator is yet to classify the rest of the over 1,600 coins and tokens in existence.
The Ripple team denies that XRP is a security, but it is currently facing a few class-action lawsuits on this subject. To help offset some of the concerns around centralization, last year the company locked up 55 billion XRP into a series of smart contracts designed to restrict its own access to the funds. However, this move caused controversy and was mentioned as a cause for complaint in one of the lawsuits, accusing Ripple of trying to affect the XRP price through this action.
Read more: https://cryptovest.com/news/morgan-creek-launches-cryptocurrency-index-fund-excludes-pre-mined-tokens/