Date: February 14, 2023
Time: 1:00–2:00 p.m. PT
Reason for Meeting: Special meeting to discuss the Hard Fork Rule.
In Attendance: Matt Hougan (Chair), Hunter Horsley (Member), Hong Kim (Member)
1: Welcome and Attendance
All members of the Committee were present at the meeting.
2: Discussion of Hard Fork Rule
Committee Chair Matt Hougan proposed a change to the Hard Fork Rule to adopt the following language:
Hard forks are new crypto assets that are granted to holders of existing crypto assets when portions of the consensus nodes adopt different policies. When a significant hard fork occurs, the Bitwise Crypto Index Committee will determine which asset will count as the continuing asset and which asset will be the new "hard fork asset." The Committee will rely on a variety of factors when making this calculation, including the relative market capitalization of each asset.
The act of claiming a hard fork requires agency on the part of crypto asset holders and also introduces risk. As such, the Bitwise Crypto Indexes do not incorporate the value of forked assets into index values. It is our expectation that fund managers tracking Bitwise Crypto Indexes may well take action to idiosyncratically claim hard fork assets, and that the value of those rewards will return to those funds as excess returns.
The Committee voted 3-0 to adopt the new language.
The Chair adjourned the meeting.
Based in San Francisco, Bitwise is one of the largest and fastest-growing crypto asset managers, offering both index and active strategies across a wide array of investment vehicles. The firm is known for creating the world’s largest crypto index fund (OTCQX: BITW), a suite of crypto-focused equity and futures ETFs, and investment products that span Bitcoin, Ethereum, DeFi, NFTs, and the Metaverse. Bitwise focuses on partnering with financial advisors and investment professionals to provide quality education and research. The team at Bitwise combines expertise in technology with decades of experience in traditional asset management and indexing, coming from firms including BlackRock, Blackstone, Meta, and Google, as well as the U.S. Attorney’s Office. Bitwise is backed by leading institutional investors and asset management executives, and has been profiled in Institutional Investor, CNBC, Barron’s, Bloomberg, and The Wall Street Journal.
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