First decentralized finance (DeFi) ETF set to launch in Brazil

Key Takeaways:

• Brazilian investment vehicle Hashdex announced the world’s first collective DeFi exchange-traded fund (ETF).
• The ETF will feature three subcategories to incorporate various DeFi use cases.
• India continues the global crypto ETF adoption.

YEREVAN (CoinChapter.com) – Days after Rio de Janeiro Mayer announced his intention to invest 1% of the city’s Treasury in Bitcoin (BTC), Hashdex had news as well. The Brazilian asset manager will launch the first DeFi ETF.

In detail, ETF investment gives traders exposure to a particular asset market without the necessity to purchase, store and resell it. As a result, the system allows a larger audience to dab their toes in cryptocurrency investment, lowering the risk factor.

Marcelo Sampaio, Hashdex’s chief executive, commented on the upcoming ETF launch. In addition, the CEO cited the importance of incorporating DeFi into the financial vehicle.

We are confident that DeFi, through its innovative and disruptive technology, will exponentially grow and play a vital role in the financial sector of the future. By offering the first DeFi ETF in the world, we are providing our global investors with the ability to play a part in the next evolution of the crypto ecosystem

said the executive.

Also read: Bitcoin gains institutional adoption in Brazil: Rio de Janeiro to invest 1% of reserves in crypto.

It is noteworthy that Hashdex was also launching the first crypto-based ETF. The Hashdex Nasdaq Crypto Index ETF was listed in Feb. 2021.

Fast forward a year, and the DeFi ETF will launch on the Brazilian stock exchange B3, under the ticker symbol DEFI11, on Feb. 17.

The First DeFi ETF

In hindsight, crypto ETFs typically track the price of one or more cryptocurrencies. As mentioned, ETFs are investment vehicles listed on stock exchanges. They leverage indirect but regulated exposure to the market.

The upcoming DeFi ETF will include 12 crypto assets. The said assets will group into three subcategories to better represent the DeFi industry and its diversified use cases.

Category #1: DeFi apps that introduce “practical and modern solutions for financial services.” The group will include crypto projects Aave, Uniswap, Compound, Maker, AMP, Yearn, Curve, and Synthetix.

Category#2: Oracle providers, i.e., DeFi protocols with data query services. Chainlink, The Graph, and Polygon cut.

Category #3: Settlement Networks. The group will include Ethereum (ETH) as a blockchain that “validates and records transactions.” 

Also read: Spot Bitcoin ETF to launch in Canada by US-based Fidelity Investments.

Hashdex created DEFI11 in partnership with CF Benchmarks, a leading global crypto index provider. Thus, the ETF will mirror the “CF DeFi Composite Index” (BLOOMBERG: CFDFMCUB). Sui Chung, the head of CF Benchmarks, voiced his excitement.

CF Benchmarks is very proud that the CF DeFi Composite Index will be the world’s first DeFi Index to be tracked by an ETF. That our partner, Hashdex, is a pioneer in Digital Asset Management, with a strong multi-year track record, makes it doubly satisfying.

commented the CEO.

Global ETF adoption continues

Months after the United States approved its first Bitcoin ETF, India might follow suit. Blockchain company Torus King Blockchain IFSC has signed a memorandum of understanding with India INX, the country’s first international stock exchange. As a result, the pair will reportedly launch India’s first cryptocurrency ETF.

Also read: SEC Rejects The VanEck Spot Bitcoin ETF Application.

Mr. V.Balasubramaniam, the Managing Director and CEO of India INX, was optimistic about the venture. The CEO mentioned the stock exchange has already applied to International Financial Services Centres Authority (IFSCA). Despite India’s difficult relationship with crypto,

We will be launching products in these new-age assets in compliance with the prevailing laws after receiving all required post regulatory approvals

commented Mr. Balasubramaniam.