DWS Launches Xtrackers Crypto Market ETC for Institutional Investors

DWS has launched the Xtrackers Galaxy MSCI Physical Crypto Market ETC Securities (ISIN: CH1492505164), a product that allows institutional investors to access major cryptocurrencies with physical backing. The new vehicle simplifies the selection and integration of these assets into a portfolio, according to Michael Mohr, Global Head of Xtrackers Product at DWS.

The ETC replicates the MSCI Crypto Market Select Index, which includes up to ten of the largest cryptocurrencies that meet certain criteria: liquidity, denomination in US dollars, a trading history of at least six months, and listing on multiple platforms backed by institutional custodians. The index composition is reviewed quarterly.

The cryptocurrency with the highest market capitalization has a maximum weighting of 50%, while the second largest is limited to 35%. Smaller or newly incorporated assets have minimum weightings of 0.5% or 1%. The underlying cryptocurrencies are held in cold storage solutions, custody systems not connected to the internet.

Xtrackers relies on Galaxy, a specialized cryptocurrency provider with whom it has been collaborating since the launch of its Bitcoin and Ethereum ETCs approximately two years ago. Mohr says that many investors face challenges when investing in cryptocurrencies due to asset selection and integration issues. With this new product, DWS offers a portfolio component that addresses these challenges.