- Valkyrie Investments today listed its third Bitcoin-related ETF on the New York Stock Exchange
- The Valkyrie Bitcoin Miners ETF will focus on companies whose energy consumption is predominantly renewable
Valkyrie, an asset manager focused on cryptocurrencies and traditional financial products, launched a new Bitcoin-related ETF today. Named the Valkyrie Bitcoin Miners ETF, the fund primarily targets publicly traded mining companies that derive at least 50% of their energy from renewable sources.
The ETF is listed on the Nasdaq under the ticker WGMI — a play on WAGMI (We’re All Gonna Make It) — and carries an expense ratio of 0.75%.
Environmental focus
The fund intends to invest 80% or more of its assets in corporate securities of businesses that derive at least half of their revenue from cryptocurrency mining or provide hardware or software related to digital asset mining. Up to 20% of assets will be allocated to companies that hold “a significant portion of their net assets” in Bitcoin or other cryptocurrencies.
Consistent with its sustainability emphasis, the ETF targets companies that obtain roughly 77% of their energy from renewable sources. For context, renewable sources account for about 31% of total energy generation in the United States.
“We found that miners who have committed to carbon-neutral goals or other sustainability initiatives tend to have lower overhead because renewable energy often costs less than other sources. That typically increases profitability,” said Leah Wald, CEO of Valkyrie Investments.
The largest individual allocations in the fund are to Argo Blockchain and Bitfarms, each receiving 10%. CleanSpark and Hive Blockchain are allocated 9% apiece, and Stronghold Digital Mining holds an 8% allocation.
The current portfolio also includes 4% allocations to a mix of other holdings, including DMG Blockchain Solutions, Marathon Digital Holdings, Bit Digital, Digihost Technology, and Power & Digital Infrastructure.
Note that portfolio allocations are subject to change over time.
Expanding exposure to the crypto sector
From the perspective of U.S. regulators, a spot Bitcoin ETF has not yet met the threshold for approval. In December, Valkyrie was denied permission to list and trade the Valkyrie Bitcoin Fund, which proposed direct exposure to Bitcoin. The SEC said the application did not meet the standards required to protect investors and the public interest or to ensure safeguards against fraud and manipulation.
Valkyrie Investments already manages two other active ETFs. The Valkyrie Bitcoin Strategy Fund was listed on the Nasdaq on October 22 and primarily trades Bitcoin futures. Two months later, the firm launched the Valkyrie Balance Sheet Opportunities ETF (VBB), which invests in publicly traded companies with exposure to Bitcoin.