What is Crypto20 (C20)?
Crypto20 is an autonomous, high-performance, low-cost cryptocurrency index fund. It tracks the top 20 cryptocurrencies in the same way the S&P500 tracks the top 500 US stocks.
Crypto20 aims to make it easier for people to invest in crypto by managing everything for them, including what cryptocurrencies to invest in, how to do it and when to make buy/sell decisions.
So far, so food, but how does it work?
CRYPTO20 is a hybrid market-cap weighted index fund consisting of the top 20 cryptocurrencies by market capitalisation. Furthermore, there will be a weekly rebalancing of the fund. This is intended to mitigate risk and to allow for diversification into the top 20 cryptocurrency assets.
Assets are capped at a maximum weighting of 10%. This cap intends to prevent any asset from dominating the fund and thus, lowering the risk of the investment.
Moreover, CRYPTO20 eliminates all the third parties involved in taking ‘cuts’ of investor returns by going direct to the end-user as a token itself. No platform charges, no broker fees, no advice fees
CRYPTO20 is part of an emerging trend of index funds for virtual currencies that have been launched over the last several years. The CRYPTO20 token may help reduce the risks that investors fast with its highly liquid nature and could inspire confidence in investors to invest more funds.