Strive Asset Management, co-founded by Vivek Ramaswamy, officially filed to launch Bitcoin Bond ETF, with the U.S. Securities and Exchange Commission (SEC).

Strive’s Bitcoin Bond ETF: What It Is and How It Works

The Strive Bitcoin Bond ETF will be an actively managed fund. It will invest in company-issued bonds that are expected to direct the proceeds toward Bitcoin purchases. 

Additionally, the ETF will have exposure to these bonds via derivatives, such as swaps and options. By using these tools, the ETF will gain indirect exposure to Bitcoin-linked financial instruments.

The ETF is designed to focus on “Bitcoin bonds,” which are defined as assets like swaps and derivatives tied to firms with a major commitment to Bitcoin. This fund intends to tap into an emerging market of companies that are significantly involved in the cryptocurrency, offering investors access to Bitcoin-related assets without directly holding the digital asset.

The Strive Bitcoin Bond ETF will primarily invest in high-quality, short-term assets such as U.S. Treasuries and money market instruments. These assets will ensure liquidity and collateral for the derivatives used to gain exposure to Bitcoin-linked bonds. This provides investors with an additional layer of stability while still allowing them to access Bitcoin’s potential for growth.

Once the ETF receives approval from the SEC, it will be listed on the New York Stock Exchange (NYSE) and held by the Depository Trust Company (DTC). It will adhere to the regulatory standards required for investment businesses, ensuring its compliance with U.S. laws.

Matthew Cole will manage the ETF along with Jeffrey Sherman and Randol Curtis, who will handle portfolio management.

Strategy to Address Economic Risks

Since its founding in 2022, Strive Asset Management has placed emphasis on addressing broader economic concerns, including inflation, the global fiat debt crisis, and geopolitical uncertainties. Strive believes that Bitcoin serves as a valuable hedge against these risks, positioning it as a central element of a diversified portfolio.

Ramaswamy has been vocal about Bitcoin’s role in long-term investment strategies. The Strive Bitcoin Bond ETF is expected to appeal to both individual and institutional investors who want exposure to the cryptocurrency space without the complexities of directly owning Bitcoin.

MicroStrategy’s Influence on the Fund’s Strategy

A key element of Strive’s strategy involves MicroStrategy, the software company known for its aggressive Bitcoin acquisition strategy. Since 2020, MicroStrategy has invested over $27 billion into Bitcoin, making it one of the largest corporate holders of the cryptocurrency. 

As part of Strive’s ETF offering, it expects to derive at least 80% of the ETF’s exposure from Bitcoin bonds issued by companies like MicroStrategy. The firm’s share price has surged by nearly 600% in the past year, largely due to its Bitcoin investments.

Details regarding the fund’s management fees have not been disclosed yet.