In less than a year, the US Bitcoin Spot ETF surpassed the US “established king” gold ETF at an astonishing rate and became the focus of the market.

Vetle Lunde, head of cryptocurrency research institute K33, said on social media platform X that the funding scale of Bitcoin spot ETFs has reached 129.3 billion US dollars, surpassing the 128.9 billion US dollars of gold ETFs. You know, gold ETFs have ruled the market for 20 years, and now, their “throne” is being challenged by Bitcoin ETFs.

This change not only breaks the gold ETF pattern, but also marks that cryptocurrencies are becoming a force to be reckoned with in the investment sector.

With the rapid expansion of the cryptocurrency market, more and more traditional investors are looking at this emerging asset. Although direct investment in Bitcoin and Ethereum is complicated and risky for many people, cryptocurrency exchange-traded funds (ETFs) make all of this simple and secure, and serve as a bridge between traditional finance and digital currencies.

In December 2024, the US Securities and Exchange Commission (SEC) officially approved the first batch of “Bitcoin-Ethereum hybrid ETFs”, which were launched by Hashdex and Franklin Templeton (Franklin Templeton), respectively. This approval marks a new era for cryptocurrency ETFs, and also heralds an acceleration in the pace of legalization of crypto assets.

As Bitcoin and Ethereum prices continue to rise, institutional investors' interest in crypto assets is growing day by day. It is expected that the listing of these two ETFs will inject new vitality into 2025 and usher in unprecedented market demand. They may become the new benchmark for cryptocurrency investment.

The situation of these two ETFs, how do they work

Now that we're talking about the benefits of cryptocurrency ETFs, let's focus on the two “Bitcoin/Ethereum hybrid ETFs” that have been approved by the US SEC — Hashdex Nasdaq Crypto Index US ETF and Franklin Crypto Index ETF. How exactly do they work, and what's so special about them? Let's take a look.

1. What is a hybrid ETF?

Simply put, a hybrid ETF is an investment instrument that combines multiple assets. The two ETFs will hold both Bitcoin and Ethereum to reflect their share in the market. According to the latest market capitalization developments, Bitcoin is expected to account for 80% of these two ETFs, while Ethereum will account for 20%.

This arrangement allows investors to indirectly invest in the two digital currencies through an ETF without having to buy Bitcoin and Ethereum separately, further reducing management complexity.

2. Positions and adjustments: Market capitalization dynamics follow the market

These two ETFs are not set in stone. Their investment ratio is adjusted regularly based on the market capitalization of Bitcoin and Ethereum.

For example, if the market value of Bitcoin increases compared to Ethereum, these two ETFs will increase the ratio of Bitcoin and keep in sync with the market. This flexible management approach ensures that investors can always enjoy the configuration that best matches the market.

3. Listing locations and regulatory requirements

The two ETFs will be listed on two different exchanges: the Hashdex Nasdaq Crypto Index US ETF will be listed on the NASDAQ exchange, and the Franklin Crypto Index ETF will be listed on the CBoE BZX exchange. The management companies of both ETFs must ensure portfolio transparency and follow strict regulatory requirements to ensure that every investor knows where their money is going.

The SEC also requires these funds to meet ongoing listing conditions, and if they do not comply, they may face the risk of delisting. It also shows the importance that regulators place on these emerging investment products to ensure the healthy operation of the market.

According to senior Bloomberg analysts, the two ETFs will be listed in January next year, and crypto president Trump will also officially take office in January next year.

Why these two companies

After understanding how these two hybrid ETFs work, we can't help but ask, why these two companies — Hashdex and Franklin Templeton? What unique advantages do they have that made them the first issuers of cryptocurrency hybrid ETFs approved by the US SEC?

Hashdex: Pioneer in the field of crypto assets

Hashdex is an asset management company focusing on crypto assets. It was founded in 2018 and is headquartered in Brazil. It is committed to providing safe and compliant crypto asset investment products for institutional investors.

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

It is particularly important to note that Hashdex was also one of the first companies in the world to launch a cryptocurrency ETF. The “Hashdex Bitcoin ETF” it launched not only successfully attracted a large number of investors, but also marked that the cryptocurrency market is developing in a more mature direction.

With its solid technical team and partnership with NASDAQ, Hashdex has successfully established a strong brand presence in the global market. The launch of the “Bitcoint+Ethereum” hybrid ETF in partnership with the US SEC has further strengthened its leading position in the cryptocurrency sector.

Franklin Templeton: Crypto Layouts for Traditional Finance Giants

Compared to Hashdex, Franklin Templeton (Franklin Templeton) is an asset management company with a long history in traditional finance. It was founded in 1947 and focuses on diversified investment strategies. Its investment products cover various fields such as stocks, bonds, real estate, and private equity. Franklin Tamberton enjoys a high reputation and broad client base in the global investment management industry.

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

Franklin Tamberton sees huge potential in crypto assets as an emerging field of investment, especially as more institutional investors are beginning to look at this asset class. By launching the “Franklin Bitcoin ETF,” Franklin Tamberton was able to provide traditional investors with a secure bridge to the crypto asset market and bring more diversified investment options to its customers.

Why do these two companies stand out?

So why these two companies? In terms of industry context, Hashdex and Franklin Tamberton each represent powerful forces in the field of crypto assets and traditional finance. The former has deep expertise in the field of crypto assets, while the latter has strong traditional financial resources and client base. The combination of the two can be said to be a double boost to the cryptocurrency ETF market.

In addition to this, these two companies' high standards in compliance and risk control are key factors that set them apart. The US SEC has always been very strict in regulating the cryptocurrency market, and being able to obtain approval from the SEC means that these two companies have established a solid foundation in terms of compliance. This has certainly boosted investors' confidence in these two ETF products.

Incidentally, although Hashdex and Franklin Tamberton are different types of companies, they both have shown a strong spirit of collaboration and innovation. Through close cooperation with their respective partners, such as Nasdaq and Cboe BZX exchanges, they have launched cryptocurrency ETF products that meet the needs of the market. And these products are in line with the current financial market's desire for innovative financial instruments.

This milestone means that US regulators are gradually easing their attitude towards the dual asset structure and interpreting the commodity attributes of the two major digital currencies more clearly.

Dual asset ETFs with diversified risk may also be more attractive to investment advisors. Previously, there were only various ETFs with a single Bitcoin or Ether in the US market. If investors wanted to lay out two major coins at the same time, they often needed to buy multiple products or trade through OTC.

In the future of the cryptocurrency market, cooperation 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 recently published13F position reportMore than 206 companies listed in the US with assets exceeding 0.1 billion US dollars have confirmed that they hold Bitcoin spot ETFs. This means that Bitcoin spot ETFs are not only the choice of individual investors, but have also been recognized by large institutions.

The holding companies mentioned in the report include global financial giants such as J.P. Morgan Chase, Goldman Sachs, Bank of Switzerland, and Morgan Stanley, and even some institutions that previously had reservations about cryptocurrencies are quietly laying out Bitcoin. For example, although Goldman Sachs has publicly stated that it is not optimistic about cryptocurrencies, its holdings in Bitcoin spot ETFs have now grown from $0.4 billion in August to over $0.7 billion.

This contrast not only shows the strong interest in Bitcoin in the market, but also shows that even institutions are gradually changing their positions in the face of actual demand.

Digital gold is also gold

Over the past 20 years, gold ETFs have been regarded as the “gold standard” for value preservation and safe haven. Especially when the economy is unstable or the market is in turmoil, gold ETFs attract large amounts of capital seeking safe haven.

Today, however, the scale of Bitcoin spot ETFs is growing so rapidly that the long-term dominance of gold ETFs has been challenged.

In fact, Bitcoin is viewed as “digital gold” by more and more investors. Its scarcity and anti-inflationary characteristics have gradually made Bitcoin replace gold as the new oneSafe haven assets. After the US Bitcoin spot ETF's asset size under management ($129.3 billion) surpassed that of the gold ETF ($128.9 billion), the “safe haven” status of a gold ETF as a traditional investment instrument is under unprecedented threat.

So why can Bitcoin ETFs trigger such a huge market response in such a short period of time?

In fact, Bitcoin and gold are similar in many ways. For example, they are both “scarce” assets, and they are all seen as tools to resist inflation. But unlike gold, Bitcoin has the advantage of higher liquidity and round-the-clock trading. The advent of Bitcoin ETFs has further lowered the threshold for investing in Bitcoin, making it easy for even investors unfamiliar with cryptocurrencies to participate through the traditional investment tool ETF.

At the same time, Bitcoin is not restricted by traditional financial markets and can be traded anytime, anywhere, which is far superior to the traditional trading method of gold. Coupled with the decentralized nature of Bitcoin, it is not controlled by a country or financial institution, which makes it more attractive to investors around the world.

Institutions are changing their faces, gold is not the only choice

The rise of Bitcoin ETFs is not only a technological breakthrough; it also reflects a fundamental shift in investment sentiment.

Once upon a time, Bitcoin represented almost a “different kind” in traditional finance. It is considered a highly speculative and risky digital asset, and many established financial institutions distance themselves from it, or even cynical about it. However, with the rapid rise in the price of Bitcoin, this once undervalued asset has gradually attracted more and more institutional investors.

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

• Use 60% of the excess cash to buy bitcoins;

• Use cash interest income held in money market accounts to buy bitcoins;

• It will also raise funds to buy more bitcoins in the future.

In response, Solidion Technology said:

The recent election results have drawn attention to Bitcoin. The Trump administration is famous for its pro-Bitcoin stance. 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 us seeking to fight against inflation and achieve value storage.

This decision not only shows companies' confidence in Bitcoin as an anti-inflation, value-preserving and value-added tool, but also reveals the market's broad recognition of Bitcoin's “new role.”

More and more companies and institutions are choosing to participate in this digital asset through Bitcoin ETFs, indicating that Bitcoin is no longer a niche investment product; it is gradually becoming a new favorite in the mainstream market.

The rapid rise of Bitcoin has undoubtedly put pressure on traditional gold ETFs, but as a safe-haven asset with a long history, gold's market position is still unbreakable. Especially when the global economy is facing a major crisis, gold remains the asset of choice for many institutions and governments, as its unique safe-haven properties are particularly important in this context.

What's interesting, though, is that future investment strategies may no longer be a single choice.

The combination of Bitcoin and gold may become a “new gold partner” for investors. Maybe in the future, they will directly launch a gold+bitcoin ETF, just like the current Bitcoin and Ethereum ETFs. Stock notes and bonds have long been a classic combination in asset allocation. The combination of Bitcoin and gold may become the golden duo in the new asset allocation.

This dual strategy provides investors with more flexibility, so they can adjust their portfolios at any time according to market fluctuations and changes in the economic environment, optimize returns, and avoid risks.

What is the next coin to be wrapped?

With the approval of the Bitcoin and Ethereum dual ETF, the market's eyes have turned to other possible crypto assets.

For example, a fork of Bitcoin such as Litecoin (Litecoin), many people think it might be the next candidate to launch an ETF. After all, it's somewhat closer to commodities, and regulatory approval is relatively simple. However, there are also opinions that if market demand is not strong, or if there is not enough institutional promotion, then whether these ETFs can actually be launched will have to be observed.

Compared to this, tokens such as Solana and XRP based on different mechanisms (such as non-proof-of-work mechanisms) are relatively unlikely to launch ETFs in the short term due to more regulatory uncertainty. However, as the entire crypto market matures, who knows what will happen in the future?

Also, one particularly noteworthy point is that the US Securities and Exchange Commission (SEC) may face personnel changes.

Reports indicate that the SEC plans to carry out a leadership change in 2025. If the new leaders are more crypto-asset friendly, that could speed up the approval of more crypto ETFs. Not only is this significant for the entire crypto industry, but it may also help more traditional investors successfully 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.

ETF Store President Nate Geraci once said that he expects this type of product to be in huge demand in the future. After all, investors are increasingly fond of diversified portfolios, especially in emerging asset classes such as cryptocurrencies. With the debut of these ETFs, we can't help but wonder if asset management giants like BlackRock (BlackRock) will follow suit and launch similar products. After all, the US Securities and Exchange Commission (SEC) has endorsed the current filing:

It would be interesting to see if BlackRock or others would try to launch a similar product. In any case, I expect there will be huge market demand for these products. Advisors love diversification, especially in emerging asset classes such as cryptocurrencies. This means that cryptocurrency ETFs have broad prospects, and more institutions are likely to participate in the future.

The release of the Bitcoin and Ethereum dual ETF marks the diversification and maturity of the US crypto asset market. Although the market may still fluctuate in the short term, as regulations are gradually relaxed, new financial products are constantly emerging, which may attract more capital inflows. In the future, we will focus on the performance of these ETFs in the market to see if investors will be keen to trade spot crypto ETFs, thus promoting the implementation of more innovative crypto applications in reality.