The news has fueled a recent price rally for Dogecoin, which is up 12.2% in the last two weeks and over 130% year-over-year, as speculation grows about the impact of the new investment vehicle.
A few years ago, a US ETF based on memecoins would have probably been laughed off among investors and even crypto traders.
But that’s far from a joke now, as the first of its kind is set to launch Thursday with Dogecoin in mind.
The First ETF With No Utility
Bloomberg ETF analyst Eric Balchunas said in a post on Tuesday that the Rex-Osprey Doge ETF (ticker: DOJE), scheduled to begin trading this week, is “the first-ever US ETF to hold something that has no utility or purpose.”
The fund is being introduced under the Investment Company Act of 1940, a framework different from the Securities Act of 1933 that governs most commodity-based or derivative grantor trusts.
Dogecoin, the asset underlying the fund, has existed for more than a decade and is often cited as the original memecoin. It has built a sizable community and inspired a broad set of copycat tokens.
The price of DOGE experienced a lot of volatility shortly after the news broke out, currently priced at US$0.24 (AU$0.36), with a market cap of about US$36B (AU$54B). But the memecoin has seen an increase of over 12.2% in the last couple of weeks, fueled by speculation over a potential ETF, and over 130% YoY.
Listing Dogecoin in an ETF is a pretty good reflection of the extent to which speculative digital assets have begun to draw institutional capital (despite having no use cases whatsoever). Crypto News Australia recently reported how CleanCore, a Nebraska-based cleaning company, announced a US$175M (AU$266M) private placement to create a Dogecoin-based treasury.
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