Bitwise Launches Automated Token Portfolios for Traditional Stocks
Bitwise, a major asset manager, is launching three automated token portfolios (ATPs) on August 25. These ATPs are built using tokenized U.S. stocks issued by Coinbase Global (NASDAQ: COIN). An ATP holds a professionally picked basket of stocks in a crypto wallet, with each company's shares represented as tokens.
The main point of holding these assets as tokens is to use their value in various crypto applications. This flexibility is not available when holding traditional stocks directly. For example, tokenized assets can be used as collateral for decentralized finance (DeFi) apps or for lending, borrowing, or trading with leverage.
The ATPs are similar to exchange-traded funds (ETFs), but investors hold the tokens directly in a crypto wallet. Bitwise selects the portfolio's holdings and target weights, while Glider performs automated rebalancing on a daily basis to match the target weights. The flagship ATP, Mag7X, holds eight stocks at an equal weight and charges a 0.15% access fee.
The use of ATPs provides a path for investors who have capital tied up in crypto but not in traditional financial systems to get exposure to businesses that mostly live in the traditional system. This is especially relevant for U.S.-based investors, as regulations around tokenized securities are still evolving and may change soon.