Valkyrie Adds Bitcoin Balance Sheet ETF

Yesterday, Valkyrie followed up its October launch of the second U.S.-listed bitcoin futures ETF with the rollout of a fund that invests in companies that either hold or use bitcoin. The Valkyrie Balance Sheet Opportunities ETF (VBB) is actively managed and does not invest directly in bitcoin.

VBB comes with an expense ratio of 0.75% and lists on the Nasdaq stock exchange.

The fund’s prospectus notes that the fund invests in companies with “innovative balance sheets.” For the purposes of VBB, that means companies that directly hold bitcoin or any companies that include bitcoin among their assets. It can also invest up to 20% of its assets in companies that, while they might not actually have any bitcoin assets, are still part of the bitcoin ecosystem.

At launch, the fund had 17 stocks in its portfolio, the largest holdings of which included MicroStrategy Inc., 15.31%; Block Inc., 10.74%; and Coinbase Global Inc., 10.25%.

(Use our stock finder tool to find an ETF’s allocation to a certain stock.)

"The companies with exposure to bitcoin read the tea leaves and have decided to take action in an attempt to preserve their value, but also as another means to potentially generate more returns for shareholders in the decades to come,” said Valkyrie CEO Leah Wald.

A press release from the company notes that more than half of all U.S. bitcoin holders only bought into the cryptocurrency this year, while 59% of all investors are interested in gaining access to it. That’s up from 36% a year ago.

While it’s not the physical bitcoin ETF that a large swath of investors are eagerly awaiting, VBB offers a way to introduce indirect bitcoin exposure to a portfolio. For risk-averse investors looking for something less volatile than directly holding the world’s top cryptocurrency, or for those with restrictions on the types of assets they can invest in, VBB could be a solution.

Contact Heather Bell at [email protected]