Coinbase to Axe High Net Worth Index Fund, Launch Small Retail ‘Bundle’
12-10-2018, 07:15 27
Copyright on text and image: CryptoGlobe.com
The index fund, launched only in June to much fanfare, was targeted at high net-worth entities, with a minimum investment at $250,000 and maximum $2 million. The product was only available to entities with a minimum net worth of $1 million, or minimum annual income of $250,000.
This lack of interest is somewhat surprising, as there was “strong demand from institutional and high-net-worth individuals” back in March when the product was first announced- - according to Coinbase project manager Reuben Bramanathan. The fund was only available to accredited U.S. investors, a disappointment to some at time of launch, perhaps explaining some of the tepid reaction.
The closing of the high-net-worth index fund comes shortly after the announcement of a new retail product, Coinbase Bundle, which may indicate a refocus in strategy back to smaller investors. The new “basket product”, announced last month, functions in effect like a mini-index fund, allowing users to buy five market-weighted crypto-assets with one click.
Notably, the minimum cost for this product is a mere $25. Coinbase speculated during the launch that:
We expect that millions of people will make their first cryptocurrency purchase in the coming years
Coinbase in the Bear Market
This possible refocus comes at a time when coinbase trading volume is down 80% since December, 2017 highs, according to Bloomberg, in the wake of the collapse in crypto-asset prices.
Despite the downturn, Coinbase is seeking $500 million worth of new investments, which would put the company’s value an eye-watering $8 billion.
Coinbase has been the go-to cryptocurrency exchange for many new users coming into the industry in the last year, because of its ease of use. Coinbase has been likened to “a 21st-century Wells Fargo for a new digital gold rush”.