Valkyrie Funds LLC (Valkyrie Investments) is launching a “green” Bitcoin Mining ETF (exchange-traded fund) today, 8th of February. The fund will be focused on bitcoin mining operators. The fund will begin trading on Nasdaq today with $WGMI as its ticker.
The ticker is inspired by an acronym in the crypto scene which stands for “we’re all gonna make it” (WAGMI). According to the fund’s SEC filing, the Valkyrie Bitcoin Miners ETF will be focused on the aspect of sustainability for bitcoin mining operators and their wider impact on the global ecological balance. According to the Cambridge Bitcoin Electricity Consumption Index, the Bitcoin network’s current power demand stands at 14.27 gigawatts. Companies on the fund’s portfolio currently source renewable energy from methods such as as solar, wind, hydropower, and geothermal energy production.
“We have found that mining companies that went the extra step here, versus carbon-neutral pledges or other initiatives, tend to maintain a lower overhead because renewable energy often costs less than other sources,” shares Valkyrie Funds CEO Leah Wald. “This tends to raise profitability,” the executive added.
The fund by Valkyrie will be managed by former Guggenheim Partners Managing Director Bill Cannon as head of ETF portfolio management. Cannon will be working alongside Steven McClurg whol will be taking on the role of chief investment officer (CIO). McClurg is known in the crypto space as the founder of Theseus Capital, a blockchain firm operating a blockchain-enabled asset management platform. Theseus Capital was acquired by Galaxy Digital.
The fund will invest in publicly traded miners and the like, which must meet certain sustainability and social responsibility criteria. These include Energy Star ratings for buildings, compliance with international environmental regulations such as those of the United Nations or European Union. Eligible publicly traded miners must carry an expense ratio of 75 basis points, or at least 77% of indexed renewable energy.
The Valkyrie Bitcoin Miners ETF has been approved by the the U.S. Securities and Exchange Commission after its initial application phase some two weeks ago. The application detailed how 80% of the ETF’s assets will be composed of companies that earn a minimum of 50% of their total revenue from Bitcoin mining, a portfolio that includes Stronghold Digital Mining, Argo Blockchain, Bitfarms, Cleanspark, and Hive Blockchain.
Wald shares that the impetus behind the ETF offering is due to the rapid rise of investors having “an increased focus and desire to gain exposure to Bitcoin miners” prompted by the recent bans on Bitcoin mining from China, which effectively introduced a shift in the industry.
Valkyrie also operates its own Bitcoin Strategy ETF (BTF), which invests primarily in bitcoin futures contracts. The investment firm was previously denied by the SEC with its application for a direct Bitcoin ETF.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
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