- Coinbase launched an index fund for crypto.
- The index fund catalogues the price movements of 50 cryptocurrencies.
- COIN50 isn’t just a revenue play, says a Coinbase exec.
On Tuesday, the world’s largest public crypto exchange launched its own crypto index fund: the COIN50, or Coinbase 50.
The investment vehicle pools together 50 different cryptocurrencies. The prices of Bitcoin, Ethereum, and Solana comprise more than 80% of the fund. The COIN50 also includes XRP, Dogecoin, and 45 other coins.
Index funds, which are pools of stocks, bonds, and other financial instruments, are mainstays of traditional finance. Like the S&P 500, which is a fund that’s a proxy for the US securities market, the COIN50 is meant to be a proxy for the broader crypto market.
While Coinbase will receive some revenue from the purchase and sale of the COIN50, the index fund is also a “media play,” Greg Tusar, head of institutional product at Coinbase, told DL News.
In other words, he says he hopes crypto market observers refer to the fund in the same way media outlets referred to Polymarket odds for the US presidential election.
“There’s an opportunity for us to represent what happened in crypto,” he said. “That creates a branding opportunity.”
Face of crypto
The launch of Coinbase’s new index fund comes as the crypto exchange looks to consolidate its position as the face of crypto in the US.
The US-based company donated more than $46 million to political action committees to elect pro-crypto candidates in the US election, according to a donations tracker from crypto researcher Molly White.
It has a sponsorship deal with the National Basketball Association, and the exchange has partnered with financial giants like BlackRock to serve as the crypto custodian for spot Bitcoin exchange-traded funds.
But Coinbase isn’t the first to create a metric to chart the performance of the crypto market.
CoinDesk and Bloomberg both have their own index fund-like benchmarks for crypto. Still, Tusar believes there’s room to compete.
“Given our brand position and the strength of the company, this is a gap in the space today,” he said.
Coinbase’s new fund will be tradeable as a futures contract for institutional investors on Coinbase’s international exchange. It will also be available for retail investors on Coinbase Advanced, which lets users perform more complicated trades.
Only users outside the US, UK, and Canada will be able to buy and sell the COIN50.
Ben Weiss is DL News’ Dubai Correspondent. Got a tip? Email him at bweiss@dlnews.com.