Cryptocurrency Wallet Abra announced that Bitwise 10 Crypto Index Token (Bit10) will be supported in its wallet app, allowing people to have exposure to more tokens when they acquire this particular coin.
This article is first published by BitPinas on October 5, 2018.
Index Tokens compared to Stock Exchange-Traded Funds
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Index Tokens can be thought of like Stock Exchange-Traded Funds. It tracks a stock index or a commodity. For example, in the Philippines, the First Metro Philippine Equity Exchange Traded Fund (FMETF) mirrors the value of the entire Philippine Stock Exchange Index (PSEi, which is composed of blue chip company stocks like Jollibee, SM, San Miguel, etc). People may invest in these individual blue-chip stocks, or they can put money on FMETF stock that follows whatever the value of the entire PSEi is.
Abra, however, said that the Bit10 Token that they are offering is not an exchange-traded fund. But we can see how it is similar to an ETF because of the exposure the token gives to its holders.
Still, Abra noted how its synthetic asset model effectively makes the token not a security. Abra CEO Bill Barhydt told Coindesk:
“The Abra BIT10 token uses the same synthetic asset model as all of the other Abra tokens available in our app. The tokens are held in fully collateralized bitcoin multi sig wallets with the user holding their own keys. As such the BIT10 token is not a security.”
Bitwise 10 Crypto Index Token
Index Tokens are the same. When you purchase Bitwise 10 Crypto Index Token (Bit10), you are essentially investing in the top 10 cryptocurrencies by market cap. So you bought 1 particular token and you gain exposure immediately to almost 80% of the cryptocurrency market. (80% of the cryptocurrency market is set to be held by the top 10 coins by market cap.)
How to Purchase Bitwise 10 Crypto Index Token
Users can exchange their bitcoin or fiat currency into the Abra app and then convert them to Bit10 Token.
Abra notes how the Bitwise10 Token actually performs better than bitcoin, the biggest cryptocurrency by market cap:
Other Index Tokens
Index Tokens, or something similar to them, are becoming available in a lot of exchanges and apps lately. Circle Internet Financial Ltd. Launched “Collections” in its app, allowing users to invest in a collection of cryptocurrencies with one purchase.
Coinbase, on the other hand, has “Coinbase Bundles”, which allows a customer to purchase all cryptocurrencies available in Coinbase with just one purchase.
Abra is a cryptocurrency wallet app that lets users deposit bitcoin, litecoin, bitcoin cash, and fiat currency. Users can keep them on the wallet or exchange them to other cryptocurrencies the app supports. Users in the Philippines can deposit through banks and can cash out through Tambunting.
- Abra Now Allows Bitcoin Cash Deposits & ADA, TRX, BAT Wallets
- You Can Use Debit / Credit Card to Buy Bitcoin in Abra Wallet
- Abra Now Supports NEM and 4 New Cryptocurrencies
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