21Shares Debuts First Crypto Index ETFs Under SEC’s 1940 Act, Boosting Trust in Blockchain Investments
Swiss-based asset manager 21Shares has made history in the crypto news space by launching the first cryptocurrency index exchange-traded funds (ETFs) in the United States regulated under the gold-standard Investment Company Act of 1940. This move marks a significant evolution for blockchain technology investment strategies, offering investors diversified access to digital assets within a familiar and highly regulated framework, a development that resonates strongly with institutional and crypto pur audiences.
The New ETFs and Their Underlying Structure
The two new funds, the 21Shares FTSE Crypto 10 Index ETF (TTOP) and the 21Shares FTSE Crypto 10 ex-BTC Index ETF (TXBC), provide broad exposure to the largest cryptocurrencies by tracking FTSE Russell indexes. TTOP includes the top 10 digital assets by market capitalization, such as Bitcoin, Ethereum, Solana, and Dogecoin, while TXBC excludes Bitcoin to emphasize other blockchain platforms and applications beyond the “digital gold” narrative.
TTOP features a 0.50% management fee, and TXBC a 0.65% fee, competitive rates in the growing crypto ETF market. Both products rebalance quarterly, ensuring they reflect the dynamic shifts in the digital asset ecosystem. Investors can now access these products through traditional brokerage accounts, bypassing the prohibitive complexities of wallets, private keys, and multiple chains.
Why the ’40 Act Is a Game-Changer for Crypto ETFs
Most U.S. crypto ETFs to date have operated under the Securities Act of 1933, which, while functional, offers weaker investor protections and less robust disclosure compared to investment-company ETFs and mutual funds governed by the ’40 Act. By adopting the ’40 Act structure, 21Shares has created crypto index funds that meet the same regulatory, disclosure, and governance standards as the most trusted financial products in the U.S..
This leap forward means better custody requirements, improved transparency for holdings, and more comprehensive protections for both individual and institutional investors. “’40 Act funds are really the gold standard for professionals,” said Duncan Moir, president of 21Shares, highlighting the growing appeal for advisors and institutions seeking diversified and regulated exposure to blockchain technology.
Strategic Partnerships and Institutional Momentum
21Shares is not only innovating at the product level, but is also expanding its business and regulatory footprint. The firm recently joined forces with alternative asset manager FalconX, significantly enhancing operational and institutional capacity while remaining independent. Both new ETFs are brought to market in partnership with Teucrium, a respected ETF advisor known for its expertise in commodities and alternative investments.
These partners, alongside FTSE Russell’s indexing expertise, mark a notable move away from spot-only Bitcoin funds toward more broadly diversified digital asset strategies, a response to increasing investor demand highlighted by the immense success of recent Bitcoin spot ETFs like BlackRock’s IBIT, which reached $70 billion AUM in just 18 months.
The Broader Trend Toward Crypto Indexing
Federico Brokate, global head of business development at 21Shares, stated, “Many of our clients have asked for a simple, regulated way to access the market as a whole rather than choosing individual tokens.” The ETFs answer this call, providing a hands-off approach to digital asset diversification that aligns with both professional investor needs and the crypto pur mission for more open, regulated blockchain access.
Conclusion
21Shares’ debut of the first-ever U.S. crypto index ETFs under the SEC’s 1940 Act marks a transformative moment for the industry, setting new foundations for trust, oversight, and widespread adoption of blockchain technology. For both institutional and retail investors, these products may offer a smarter, safer, and more scalable gateway to the next era of crypto news and digital asset investment.