To say these are trying times for Bitcoin and the broader cryptocurrency complex is an understatement. With Bitcoin’s recent, deep slide, all the gains from the post-2024 presidential election rally are gone, but that’s not even the worst of it.
Not only is the largest digital currency probing prices last seen prior to Election Day 2024, but its oversold condition is historically unusual. Last week, CoinDesk reported that Bitcoin’s relative strength index (RSI) – a technical gauge used to measure overbought and oversold conditions – was residing around 17. That’s oversold. The last two times Bitcoin was that oversold was during its 2018 bear market and the 2020 market slide caused by coronavirus pandemic.
In other words, 2026 has been a tough time to launch new crypto exchange traded funds (ETFs), but some issuers have tempted fate and it’s possible they’ll be rewarded for taking those leaps, provided Bitcoin and friends rebound at some point. With that in mind, let’s have a look at one of the newest entrants in the world of crypto ETFs.
Tales from the KRYP
On Feb. 2, ProShares launched the ProShares CoinDesk 20 Crypto ETF (KRYP), the first ETF tracking the CoinDesk 20 Index. In cryptocurrency indexing terms, that’s one of the gold standards and its selection universe spans 250 tokens.
“The Index is designed to measure the performance of the 20 largest and most liquid eligible cryptocurrencies,” according to ProShares. “The crypto assets included in the Index are weighted based on market capitalization, subject to a 30% cap on the largest constituent and a 20% cap on all others at each weight assignment. The Index does not include stablecoins, memecoins, wrapped tokens, privacy tokens, and certain other types of cryptocurrencies.”
Said another way, investors that are crypto-enthused, but also risk-averse may come to embrace this new ETF because it eschews speculative fare and focuses on the largest coins with credible upside potential. Likewise, the exclusion of stablecoins is meaningful because that policy ensures that when digital currencies bounce back, KRYP won’t be hindered by assets with no meaningful appreciation potential.
Bitcoin and Ethereum, the two largest digital currencies by market value, combine for roughly half of KRYP’s roster while Binance Coin (BNB) and XRP combine for another 31%. It should be noted KRYP’s exposures are attained through swaps, not direct holdings of digital currencies.
Keep an Eye on KRYP
Again, the current environment may not be hospitable to any crypto ETF, new or old, but that doesn’t mean KRYP should be glossed over entirely. The structure is attractive, indicating this could be an ideal with which tactical investors can capitalize on a digital currency resurgence.
““As the cryptocurrency market has matured, investors have increasingly looked beyond single-asset exposure,” said ProShares CEO Michael L. Sapir in a statement. “KRYP is the only ETF designed to provide diversified exposure to the broader crypto asset class in a single ticker, using a transparent, rules-based approach that limits concentration risk and adapts as market leadership changes over time.”
KRYP’s annual expense ratio is 0.58%, or $58 on a $10,000 investment.
Related: These Are the Segments Where Advisors Prefer ETFs Over Mutual Funds