In the lead-up to this week’s surprise listing of its Solana Staking ETF on the New York Stock Exchange, Bitwise CEO Hunter Horsley caused a stir by telling Cointelegraph that Solana’s shorter validator exit queue gave it the edge over Ethereum in the staking ETF race.
Bitwise chief investment officer Matt Houghan went much further on a podcast, praising Solana’s speed, throughput and finality as “extraordinarily attractive.” He labelled it “the new Wall Street.”
The glowing endorsements were controversial among Ethereum fans, some of who seemed to believe Bitwise was betraying ETH’s cypherpunk values by championing other projects.
Horsley was stung by the criticisms, not least because Ethereum was part of the inspiration for creating Bitwise in the first place.
He replied he felt “terrible to see these posts. We care a lot about Ethereum…. Feedback received re recent commentary seeming to be at odds with values in the ETH community. It’s being taken to heart.”
But does Bitwise actually hold cypherpunk values today? Would it launch an ETF for a blockchain that made little effort to be credibly neutral — say, to take a completely random example — a Tron ETF?
“We want to see everyone succeed,” Horsley says diplomatically, adding Bitwise would support any project with a credible team and a credible vision, and avoid any that don’t.
“It’s sometimes so funny to me when people get sort of so angry about competitors,” he says.
“I don’t think anyone would say that they wish that the iPhone was the only smartphone in the world and that all competitors disappeared and Apple had to compete with nobody.
“Monopolies are what users hate, so you know, I think it’s a real benefit that there’s competition because it drives improvement.”
Competition is certainly coming. Horsley reveals that Bitwise will take advantage of the SEC’s new generic listing standards with ETF applications for XRP, Avalanche, ChainLink, Hyperliquid, Aptos and Near.
Bitwise’s Solana ETF (BSOL) saw almost $56 million in volume on its first day, making it the strongest ETF launch of the year according to Bloomberg. Farside reported inflows of $69.5 million. (While it’s unusual to have inflows higher than volume, it does sometimes happen, especially when large institutional creation orders occur in the early days of an ETF.)
Sovereign wealth funds eye Bitcoin and Ethereum ETFs
Magazine catches up with Horsley in Singapore, shortly after his 45th flight this year. The globe-trotting exec explains that Bitwise Asset Management has been fielding interest from sovereign wealth funds.
“Oh, yes, yeah, more than one,” he says, but estimates it will take “three to six months” for their crypto ETF investments to land.
“The bigger the institution, the more consensus has to be developed, approvals, proposals, etc.”
The fact that a sovereign wealth fund is even talking to Bitwise is impressive, considering BlackRock dominates the Bitcoin and Ether ETF sector. But Bitwise has positioned itself as a crypto specialist firm amid a sea of TradFi issuers.
It seems to be working. Bitwise is in a very respectable fourth place among crypto ETF issuers, ahead of big names like Invesco, VanEck, Valkyrie and WisdomTree.
For crypto natives, part of the appeal is that it’s the only issuer to donate 10% of its profits to blockchain development.
Where did Bitwise come from?
The most amazing thing about Bitwise is that Horsley managed to get it funded in his mid-twenties — before he’d even had the idea for the crypto firm.
He was working as a product manager at Facebook and Instagram when an offer came in from investors willing to back whatever venture he and his college bestie, Hong Kim, came up with.
Horsley says it was a pretty major life decision to quit the hottest social media company in the world in November 2016.
“I felt even though I loved my job and felt very grateful to have it that I would regret not walking through that door even if it was treachery on the other side,” he says.
He accepted the offer and the pair rented an apartment to work from, above a tie-dye shop in San Francisco’s Haight Ashbury, “surrounded on both sides by tattoo parlors.”
“Then we set to work on figuring out what in the world we wanted to do,” he says.
Horsley had bought Bitcoin a few years earlier, but it was the city’s embrace of Ethereum that year that gave them the idea for Bitwise.
“A lot of people were thinking about and talking about it,” he says, noting the decentralized, trustless tech appealed to the anti-establishment culture.
“I think that inherent in crypto is a proposition…
cointelegraph.com