Uniswap (UNI) and Aave (AAVE) have been incorporated into Bitwise Investments‘ 10 Large Cap Crypto Index fund, as part of its January end-of-month rebalancing. The inclusion will provide one of the very first opportunities for institutional investors to obtain exposure to DeFi projects, in the order of hundreds of millions of dollars.
The move follows a recent explosion in price of major DeFi project tokens, catapulting several of them into the top-20 largest projects ranked by market cap. UNI and AAVE in particular have comfortably reached top-10 status, making them eligible for the 10 Large Cap Crypto Index by Bitwise. To make the cut, the two tokens also needed to satisfy various other requirements, including high trading volumes, a high unlikelihood of being deemed a security, and the ability to be held by a regulated third-party custodian.
What does this mean for DeFi?
The inclusion of UNI and AAVE in the index will almost certainly drive DeFi further into the spotlight, adding an air of legitimacy to the space – which until recently has only truly been recognized and appreciated by active Ethereum DApp users.
Catalyzed by a new rebellion against centralized platforms from the recent RobinHood and Gamestop saga, a perfect storm is forming for DeFi to begin receiving mainstream attention.
About Bitwise Investments
Bitwise recently made headlines for reaching a substantial $500 million in assets under management to end 2020, 80% of which was in the aforementioned top-10 index fund. The company has reported steep increases in participation from hedge funds, family offices and financial advisers, in particular over the last quarter.
The index provides exposure to several assets that aren’t available through other institution-friendly companies such as Grayscale, whose “equivalent” fund contains a basket of only Bitcoin, Ethereum, Bitcoin Cash and Litecoin.