In less than a year, the Bitcoin spot ETF in the USA has surpassed the 'old champion' Gold ETF at an astonishing speed, becoming the focus of the market.

Vetle Lunde, the head of the cryptocurrency research institution K33, stated on the social platform X that the funding scale of the Bitcoin spot ETF has reached 129.3 billion USD, surpassing the Gold ETF's 128.9 billion USD. It is important to note that the Gold ETF has dominated the market for 20 years, and now its 'throne' is being challenged by the Bitcoin ETF.

This change not only breaks the pattern of the Gold ETF but also signifies that cryptocurrencies are becoming an undeniable force in the investment field.

With the rapid expansion of the cryptocurrency market, more and more traditional investors are also beginning to look at this emerging asset. Although direct investment in Bitcoin and Ethereum can still be quite complex and risky for many, cryptocurrency exchange-traded funds (ETFs) make it simple and safe, serving as a bridge between traditional finance and digital currency.

In December 2024, the USA Securities and Exchange Commission (SEC) officially approved the first batch of 'Bitcoin + Ethereum Hybrid ETFs', launched by Hashdex and Franklin Templeton. This approval marks a new era for cryptocurrency ETFs and signifies that the pace of cryptocurrency asset legalization is accelerating.

With the continued rise in the prices of Bitcoin and Ethereum, institutional investors' interest in crypto assets is increasing day by day. It is expected that the launch of these two ETFs will inject new vitality into 2025, ushering in unprecedented market demand. They may become new benchmarks for cryptocurrency investment.

How do these two ETFs operate?

Since we are talking about the benefits of Cryptocurrency ETFs, let's focus next on the two "Bitcoin + Ethereum Mixed ETFs" that have received approval from the SEC in the USA—Hashdex Nasdaq Crypto Index US ETF and Franklin Crypto Index ETF. How do they operate and what makes them special? Let's take a look.

1. What is a Mixed ETF?

In simple terms, a Mixed ETF is an investment tool that combines various assets. These two ETFs will hold both Bitcoin and Ethereum simultaneously to reflect their proportions in the market. According to the latest Market Cap dynamics, Bitcoin is expected to account for 80% of these two ETFs, while Ethereum will make up 20%.

This configuration allows investors to indirectly invest in two types of Digital Currency through one ETF without needing to separately purchase Bitcoin and Ethereum, thereby further reducing management complexity.

2. Hold Positions and Adjustments: Market Cap Dynamics Follow the Market

These two ETFs are not static. Their investment proportions will be periodically adjusted based on the market Market Cap of Bitcoin and Ethereum.

For example, if the Market Cap of Bitcoin increases relative to Ethereum, these two ETFs will increase the proportion of Bitcoin to stay in sync with the market. This flexible management approach ensures that investors can always enjoy a configuration that best matches the market.

3. Listing Locations and Regulatory Requirements

These two ETFs will be listed on two different Exchanges: Hashdex Nasdaq Crypto Index US ETF will be listed on the Nasdaq, while Franklin Crypto Index ETF will be listed on the Cboe BZX. The management companies of both ETFs must ensure the transparency of their portfolios and adhere to strict regulatory requirements to ensure that every investor understands the destination of their funds.

The SEC also requires these funds to meet ongoing listing conditions, and failure to comply may result in delisting risks. This also indicates the regulatory agency's emphasis on these emerging investment products, aiming to ensure the healthy operation of the market.

According to Bloomberg senior analyst projections, these two ETFs are expected to be listed in January next year, while crypto President Trump will also officially take office in January next year.

Why these two companies

After understanding how these two hybrid ETFs operate, one cannot help but ask why these two companies—Hashdex and Franklin Templeton? What unique advantages do they possess that make them the first issuers of the cryptocurrency hybrid ETFs approved by the USA SEC?

Hashdex: A Pioneer in the Field of Crypto Assets

Hashdex is an asset management company focused on digital assets, founded in 2018 and headquartered in Brazil, dedicated to providing secure and compliant digital asset investment products for institutional investors.

One of Hashdex's highlights is its professional experience and innovative thinking in the field of digital assets.

It is particularly noteworthy that Hashdex is also one of the first companies in the world to launch a cryptocurrency ETF. The "Hashdex Bitcoin ETF" not only successfully attracted a large number of investors but also marks that the cryptocurrency market is developing towards a more mature direction.

With its solid technical team and partnership with Nasdaq, Hashdex has successfully established a strong brand influence in the global market. The recent collaboration with the SEC to launch a "Bitcoin + Ethereum" hybrid ETF further reinforces its leadership position in the digital currency field.

Franklin Templeton: The cryptocurrency strategy of a traditional financial giant.

In contrast to Hashdex, Franklin Templeton is an asset management company with a long history in traditional finance, founded in 1947, focusing on diversified investment strategies. Its investment products cover multiple sectors including stocks, bonds, real estate, and private equity. Franklin Templeton enjoys a high reputation and a broad client base in the global investment management industry.

Why would such a traditional financial giant choose to venture into the cryptocurrency market? This is closely related to its growing recognition and demand for cryptocurrencies.

Franklin Templeton sees enormous potential in Cryptos as an emerging investment field, especially as more and more Institutional investors begin to focus on this asset class. By launching the "Franklin Bitcoin ETF", Franklin Templeton can provide traditional investors with a secure bridge to connect with the Cryptos market, offering their clients more diversified investment options.

Why do these two companies stand out.

So, why these two companies? From an Industry perspective, Hashdex and Franklin Templeton represent powerful forces in the fields of Cryptos and traditional finance. The former has deep expertise in Cryptos, while the latter boasts strong traditional financial resources and a client base. The combination of both can be seen as a dual impetus for the Cryptocurrency ETF market.

In addition, the high standards of compliance and risk control exhibited by these two companies are key factors that set them apart. The SEC in the USA has always had strict regulations on the Cryptocurrency market, and obtaining SEC approval means that these two companies have established a solid foundation in compliance. This undoubtedly enhances investor confidence in these two ETF products.

By the way, although Hashdex and Franklin Templeton belong to different types of companies, they both demonstrate a strong spirit of cooperation and innovation. Through close collaboration with their respective partners (such as Nasdaq and Cboe BZX Exchange), they have launched Cryptocurrency ETF products that meet market demand. These products precisely respond to the current financial market's craving for innovative financial instruments.

This milestone indicates that US regulators are gradually easing their stance on dual-asset structures, interpreting the commodity attributes of the two major Digital Currencies more clearly.

For investment advisors, the risk-diversified dual-asset ETF may also be more attractive. Previously, the US market only had various ETFs based on a single Bitcoin or Ethereum. If investors wanted to simultaneously lay out positions in the two major altcoins, they often needed to purchase multiple products or resort to OTC trading.

In the future of the Cryptos market, collaboration between traditional financial companies and crypto asset companies may become mainstream, further driving the entire industry forward.

Beyond Gold ETFs, breaking the 20-year market pattern.

According to a recent release,13F holding reportover 206 companies listed in the USA with asset sizes exceeding 0.1 billion USD have confirmed their Hold of Bitcoin spot ETFs. This means that Bitcoin spot ETFs are no longer just a choice for individual investors, but have also gained recognition from large institutions.

The companies mentioned in the report include global financial giants such as JPMorgan, Goldman Sachs, Swiss Bank, Morgan Stanley, and even some institutions that were previously reserved about Cryptos are quietly laying out positions in Bitcoin. For example, although Goldman Sachs publicly stated that it is not bullish on Cryptos, its position in Bitcoin spot ETFs has increased from 0.4 billion USD in August to over 0.7 billion USD.

This contrast not only indicates strong market interest in Bitcoin but also suggests that even institutions are gradually changing their stance in the face of real demand.

Digital Gold is also Gold.

For the past 20 years, Gold ETF has been regarded as the standard for value preservation and hedging. Especially during economic instability or market turbulence, Gold ETFs have attracted a significant amount of fund seeking shelter.

However, today, the rapid growth of Bitcoin spot ETF has challenged the long-standing dominance of Gold ETF.

In fact, Bitcoin is increasingly being viewed by investors as 'digital gold', and its scarcity and inflation-resistant characteristics are gradually allowing Bitcoin to replace Gold as the new.Its price has soared to a historic high, closely related to market expectations of interest rate cuts by the Federal Reserve.After the management asset scale of Bitcoin spot ETF in the USA (129.3 billion USD) surpassed that of Gold ETF (128.9 billion USD), the 'safe haven' status of Gold ETF, a traditional investment tool, is facing unprecedented threats.

So, why has Bitcoin ETF elicited such a significant market response in such a short time?

In fact, Bitcoin and Gold share many similarities, such as both being 'scarce' assets and being considered tools to resist inflation. However, unlike Gold, Bitcoin offers higher liquidity and the advantage of 24/7 trading. The emergence of Bitcoin ETF further reduces the investment threshold for Bitcoin, enabling even investors unfamiliar with Cryptos to easily participate through this traditional investment tool.

At the same time, Bitcoin is not restricted by traditional financial markets and can be traded anytime and anywhere, which is far superior to the traditional trading methods of Gold. Additionally, due to Bitcoin's decentralized nature, it is not controlled by any specific country or financial institution, which provides greater appeal to investors globally.

Institutions change their stance; Gold is not the only choice.

The rise of Bitcoin ETF is not only a breakthrough on a technical level, but it also reflects a fundamental shift in investment sentiment.

Once upon a time, Bitcoin was almost seen as an 'outlier' in traditional finance. It was considered a highly speculative and risky digital asset, and many established financial institutions kept their distance, even mocking it. However, with the rapid rise in Bitcoin's price, this once undervalued asset is gradually attracting more and more institutional investors.

For example, Solidion Technology, a Battery company, announced their strategy:

• Use 60% of excess Cash to purchase Bitcoin;

• Use the interest income from Cash held in the Money Market account to purchase Bitcoin;

• In the future, they will also raise funds to purchase more Bitcoin.

In response, Solidion Technology officially stated:

The recent election results have sparked attention towards Bitcoin, with the Trump administration being known for its support of Bitcoin. The recent growth of Bitcoin spot ETFs also highlights the potential for Institutions to adopt Bitcoin under regulatory compliance. Bitcoin is expected to become an ideal asset for combating inflation and achieving value storage.

This decision not only showcases the confidence of enterprises in Bitcoin as a tool for anti-inflation and value preservation but also reveals the market's broad recognition of Bitcoin's 'new role.'

An increasing number of enterprises and Institutions are choosing to participate in this digital asset through Bitcoin ETFs, marking that Bitcoin is no longer a niche investment product; it is gradually becoming a new darling of the mainstream market.

The rapid rise of Bitcoin undoubtedly places pressure on traditional Gold ETFs. However, as a long-standing safe-haven asset, Gold's market position remains unshakeable. Particularly during significant global economic crises, Gold continues to be the preferred asset for many Institutions and governments because of its unique hedging properties, which are especially important in such situations.

Interestingly, future investment strategies may no longer be a single choice.

The combination of Bitcoin and Gold may become the "new golden partner" for investors, and perhaps in the future, there will be direct listings of a Gold + Bitcoin ETF, similar to the current Bitcoin and Ethereum ETFs. Just as Stocks and Bonds have long been a classic combination in asset allocation, the pairing of Bitcoin and Gold could become the new golden duo in asset allocation.

This dual strategy provides investors with greater flexibility, allowing them to adjust their portfolios anytime based on market fluctuations and changes in the economic environment, optimizing returns while avoiding risks.

What will be the next packaged coin?

With the approval of Bitcoin and Ethereum dual ETFs, the market's attention has turned to other potential crypto assets.

For example, Litecoin, a fork of Bitcoin, is seen by many as a potential candidate for the next ETF launch. After all, it is somewhat closer to commodities, and the approval process from regulators is relatively simple. However, there are also views that if market demand is not strong or there isn't sufficient institutional support, the actual launching of these ETFs still needs to be observed.

In comparison, tokens like Solana and XRP, which are based on different mechanisms (such as non-proof of work mechanisms), face more regulatory uncertainties, making the likelihood of launching an ETF in the short term relatively low. However, as the entire crypto market matures, who knows what will happen in the future?

Additionally, a particularly noteworthy point is that the SEC may face personnel changes.

Reports indicate that the SEC plans to undergo a leadership change in 2025. If the new leadership is more friendly towards crypto assets, it could accelerate the approval of more crypto ETFs. This is not only significant for the entire crypto industry but could also help more traditional investors smoothly enter this emerging market. If more types of crypto ETFs are approved, the boundaries between the traditional financial world and blockchain will become increasingly blurred, making it easier for investors to participate.

Nate Geraci, president of the ETF Store, has expressed that he expects huge demand for such products in the future, as investors increasingly prefer diversified portfolios, especially in emerging asset classes like digital currency. With the debut of these ETFs, it is intriguing to speculate whether asset management giants like Blackrock will follow suit in launching similar products. After all, the SEC has acknowledged the current application documents.

It will be interesting to see if Blackrock or other companies attempt to launch similar products. In any case, I expect there will be huge market demand for these products. Advisors like diversity, especially in emerging asset classes like digital currency. This suggests a promising outlook for cryptocurrency ETFs, and more institutions may participate in the future.

The launch of Bitcoin and Ethereum dual ETFs marks a diversification and maturation of the USA's crypto asset market. While the market may still experience volatility in the short term, as regulation gradually relaxes and new financial products emerge, this may attract more inflow of funds. In the future, we will focus on the performance of these ETFs in the market to see if investors are eager to trade spot crypto ETFs, thereby driving more innovative crypto applications to be realized in reality.