Crypto Index ETFs To Take Next Wave Of Adoption, Says Exec

WisdomTree’s head of digital assets, Will Peck, anticipates that exchange-traded funds (ETFs) containing diversified baskets of cryptocurrencies will fill a significant gap in the market in the coming years.

“It looks like it’s going to be one of the next waves of adoption,” Peck told Cointelegraph at The Bridge conference in New York City on Wednesday. “It solves a need, I think,” he added.

Peck explained that although many new investors now understand the concept of Bitcoin (BTC), often struggle to judge the “next range of 20 axes”. He said a multi-asset crypto basket would provide him exposure to the sector while mitigating the “idiosyncratic risk” of investing in individual tokens.

Will Peck says index ETF investors will support the technology

“Crypto we talked about as an asset class, but it’s really a technology, and the underlying return engines of each of these tokens are actually very different, although they are correlated, in general, just because that’s where the market is,” he explained.

It comes as several crypto index ETFs have launched this year. Lately, Thursday, asset manager 21Shares has launched two cryptos Index ETFs, which are regulated by the Investment Company Act of 1940.

Just a couple of months before, on September 25, asset extended Hashdex manager its Crypto Index US ETF to include XRP (XRP), SOL (SOL), and Stellar (XLM), following the generic listing rule change by the Securities and Exchange Commission (SEC).

Peck said the timing of broader adoption for crypto index ETFs is “difficult to predict exactly,” but suggests it may be inevitable given the direct utility of having a product that provides such exposure.

Peck expects a surge in new crypto ETF launches as ETF issuers compete for an early advantage, which he said may erode the idea that an ETF automatically signals the cryptocurrency token has some authority or credibility.

Bitcoin ETF’s success ‘exceeded’ Will Peck’s expectations

“I think it’s going to be a change, like, where, five years ago, you said: Oh, if something has an ETF, like, Bitcoin is going to get one, maybe it’s the first, it has to have some sort of institutional stamp of, like, approval,” he said.

“I don’t think that’s necessarily how the SEC should be, a merit-based regulator in that sense, right? And it’s really going to be about customers making the right choices with their money,” Peck added.

Meanwhile, Peck said the “overall success” of spot Bitcoin ETFs since their launch in January 2024 has exceeded his expectations.

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“It’s remarkable to me how big the Bitcoin ETF categories, crypto in general, is one of the most competitive parts of the US ETF market,” he said.

Since the launch of the US-based spot Bitcoin ETF, the products have accumulated approximately $58.83 billion in net inflows, according to to Farside.

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