No one will deny that cryptocurrencies open up a lot of existing markets and new business opportunities. Some of the business models require a rather bold approach, as Crypto20 illustrates perfectly. This project is all about establishing a tokenized cryptocurrency index fund which supports a total of 20 different currencies. Its native token, known as C20, can be traded on various exchanges.
Why Should we Care About Crypto20?
Not every person on the globe is cut out to buy cryptocurrencies and hold onto them for the long term. That is only normal, as the process of buying cryptocurrencies and storing them is rather tedious. As such, the Crypto20 tokenized crypto index fund allows investors to be exposed to the price fluctuations of 20 different currencies. All they need to do is own the C20 token and they will benefit from its positive valuation fluctuations. Right now, the fund is valued at US$83.78 million, even though it is likely that number will increase in the months to come.
So How Does it Work?
As the name suggests, Crypto20 is a tokenized cryptocurrency fund, which has a portfolio of 20 currencies at all times. According to the website, their holdings are mainly Bitcoin, Ethereum, Bitcoin Cash, and XRP. Litecoin, Cardano, Stellar, NEO, EOS, IOTA, Dash, NEM, Monero, Lisk, ETC, Tron, VeChain, Qtum, Bitcoin Gold, and ICON are all represented as well. Clearly, the fund is mainly interested in the top 20 cryptocurrencies ranked by overall market cap.
Given that market cap rankings fluctuate every now and then, Crypto20’s positions in specific coins will change accordingly. Additionally, if coins drop out of the top 20, the fund will change its portfolio accordingly. It is an autonomous token-as-a-fund which charges no broker or exit fees and doesn’t require any minimum investment. Moreover, users control their assets at all times with full transparency.
There is an annual fee to take into account, but it’s just 0.5%. In traditional financial markets, such fees can be as high as 3%. Moreover, the active trading is fully autonomous and requires no human involvement whatsoever. As such, it’s an easy way in which to be exposed to cryptocurrencies without holding 20 different coins. All of this is taken care of by a public smart contract which has not run into any major issues as of yet.
Explaining the C20 Token
Becoming a client of the Crypto20 fund requires ownership of the C20 token, which is listed on a few exchanges. As more trading platforms allow for the trading of this currency, overall liquidity will improve. By owning this token, users are directly exposed to the financial gains and losses made by the Crypto20 fund. Owning more tokens means more exposure and room for potential profits or losses.
The Road Ahead for Crypto20
As one would expect, there is still some work to be done before Crypto20 can reach its full potential. With the ICO completed and a public audit of the ICO funds conducted, the time is now for the company to set up more exchange listings and collect data from more exchanges where the currencies in the fund’s portfolio can be traded. It will take a few more months until this process is complete, after which ICO participants will have access to the AI-managed funds by DataProphet.