What is a crypto index ETP?
Summary
A crypto index ETP is a listed security designed to follow a rules-based selection of crypto-assets. The index determines the assets and their weights; the investor holds one security in a brokerage account. Virtune’s index ETPs are physically backed securities, not funds.
- An index is a calculation; the ETP is the security an investor can hold.
- Component weights can make a few assets dominate an index, even when it contains many assets.
- Virtune Stablecoin Index ETP holds infrastructure assets rather than currency-linked stablecoins.
What is a crypto index ETP?
A crypto index ETP is a listed security designed to follow a rules-based selection of crypto-assets. An index defines which assets are included and how much each contributes to the index value. The ETP gives an investor exposure to those assets through one holding in a brokerage account. Virtune's index ETPs hold the underlying crypto-assets as collateral; the investor owns the security rather than coins in personal wallets. This physical backing arrangement supports the security without giving its holder ownership of the individual coins (Virtune ETP ownership).
How does a crypto index work?
An index answers two questions: which crypto-assets should be included, and how much should each count? An index weighted by market value gives larger assets more influence. An equal-weighted index gives each asset the same share when it is rebalanced. That difference matters: the same price move has a greater effect when it comes from an asset with a larger weight.
How does rebalancing work?
Imagine an index containing two coins with equal shares. If one rises more than the other, it becomes a larger part of the index. Rebalancing adjusts their weights so that each has an equal share again, assuming both coins remain in the index.
Other indices use different rules, such as weighting assets by market value. A review can also add or remove assets from the selection. For an ETP following the index, the underlying holdings are adjusted to follow those changes. The investor continues to hold the same ETP security.
How do Virtune's crypto indices differ?
Virtune Coinbase 50 Index ETP follows the Coinbase 50 Europe Index. It selects assets from the broader Coinbase 50 Index that meet European component eligibility requirements. The assets have different weights, with a limit on how much one asset can contribute.
Virtune Crypto Top 10 Index ETP follows an index focused on leading crypto-assets by market value, with a limit on any single asset's weight.
Virtune Crypto Altcoin Index ETP follows leading altcoins with equal weights, excluding Bitcoin and Ethereum. This gives each included altcoin the same share at rebalancing, rather than giving the largest ones more influence.
Virtune Stablecoin Index ETP follows crypto-assets associated with stablecoin issuance and infrastructure. These assets support the stablecoin ecosystem; they are not themselves stablecoins designed to maintain a currency-linked price.
The product pages show current holdings and weights.
Is there an index fund for crypto in Europe?
An index describes a selection of assets and their weights, while a fund or a note describes the legal vehicle. Similar to an index fund, but for crypto, an index ETP packages several assets into one holding. Virtune's index ETPs are securities issued as debt instruments, not funds.
The UCITS eligible-asset rules restrict a fund's investments, so a selection of crypto-assets does not automatically qualify as a UCITS ETF. A European search for “crypto index fund” or “crypto index ETF” can therefore lead to an ETN, a type of ETP with a different legal structure.
What does diversification change?
An index product spreads exposure across its components, reducing dependence on one asset compared with a holding that tracks only that asset. It still concentrates exposure in the crypto market, whose assets can fall together. An index excluding Bitcoin and ETH has a different exposure from one dominated by them; neither a component count nor equal weights removes market risk.
Index construction also does not remove the ETP issuer's credit risk or risks in custody and collateral. Index ETP structural risks apply alongside price changes in the underlying assets.
What costs and currency effects matter?
Each product has its own management fee, which reduces its value over time. The table below shows the current fee and cost types for Virtune Coinbase 50 Index ETP; the other products' pages carry their respective costs. Brokerage, the difference between buy and sell prices, and possible currency conversion also affect a trade.
Costs when buying Virtune Coinbase 50 Index ETP
| Cost | Charged by | When |
|---|---|---|
| Brokerage commission | Broker | On every purchase and sale |
| Difference between bid and ask price | Market | On every trade |
| Management fee, 0.95% per year | Issuer | Ongoing, from the product's value |
| Currency conversion | Broker, if applicable | If the product trades in another currency |
A euro-denominated security is not automatically protected from currency effects. The investor's result depends on the underlying assets' values and the currency in which the holding is measured. Tax treatment depends on the investor's country and account type.
Related reading
How to buy a crypto ETP explains brokerage access. What an ETP is covers the legal category, what stablecoins are separates stablecoins from their infrastructure, and what altcoin season means explains the market term rather than an index product.
Virtune products in this area
View all products
Sources
- Virtune Investor Relations: Collateralization Methodology
- Virtune Investor Relations: Prospectus
- Official Journal of the European Union: Directive 2009/65/EC (UCITS)
