Friday, February 23

The first decentralized finance ETF arrives in Latin America

The crypto asset manager Hashdex, located in Brazil, reported that the first decentralized finance (DeFi) exchange-traded fund (ETF) in the South American nation was approved.

According to what was stated by the firm, the The purpose of the ETF will be to offer investors exposure “diversified, safe and regulated in all segments of the DeFi ecosystem.”

The financial instrument will begin trading on the Brazilian Stock Exchange on February 17, reported from Hashdex, today, January 19.


In this regard, Marcelo Sampaio, executive director of Hashdex, said that they are betting on DeFi, because they are an “innovative and disruptive technology that will grow exponentially and play a vital role in the financial sector of the future.”

The entrepreneur believes that with the new ETF they will provide investors with the opportunity to be part of the “next evolution of the ecosystem” of cryptocurrencies.

The ETF index will be made up of 12 crypto assets from the DeFi Uniswap, AAVE, Compound, among others. Source: Hashdex website.

The ETF was developed by Hashdex in partnership with global cryptocurrency index provider CF Benchmarks. The new fund will mirror the “CF DeFi Composite Index.”

ETF offers exposure to 12 assets

The ETF gives its investors exposure to 12 crypto assets. According to the Brazilian company, the index will be divided into “three sub-portfolios to accurately reflect the entire value chain that supports DeFi services”:

The first sub-portfolio is headed by DeFi protocols related to the area of ​​lending, exchanges, insurance, derivatives, and asset management. There are Uniswap, AAVE, Compound, Maker, Yearn, Curve, Synthetix and AMP. These make up the 70% of the rate.

It is followed by support for DeFi protocols: data services (provision, storage and query), identity verification and scalability solutions. Those are represented by Chainlink, The Graph, and Polygon.


Finally, there are those Smart contract platforms: native blockchains where transactions are validated and recorded, such as the Ethereum network and its native cryptocurrency, ether (ETH).

Brazil, land of ETFs in Latin America

In Brazil, since 2021, initiatives have emerged for the creation of the first Bitcoin and Ethereum ETFs in Latin America.

In March of last year, Hashdex itself launched the first bitcoin and other cryptocurrency exchange-traded fund. This tracks the Nasdaq Crypto Index (NCI), as reported by CriptoNoticias.

The Hashdex ETF replicates the composition of the NCI which is based on 6 crypto assets, bitcoin (BTC), ether (ETH), litecoin (LTC), Chainlink (LINK), Bitcoin Cash (BCH) and Stellar (XLM).

On the other hand, in mid-2021, the Brazilian financial services company, QR Capital, reported that it would put the first Ethereum ETF into action.

The Criptopedia (educational section of CriptoNoticias) defines ETFs as hybrid financial products, since they have characteristics of an investment fund and operate like a stock. They can be made up of various assets, of which they track the price to replicate them in their market.