Cryptocurrency index funds make no sense in general - the correlation between coins is too negative for holding a basket of them to make sense. You want to diversify over uncorrelated assets. Holding offsetting long and short positions makes zero sense, and due how most alt-coins are priced by their ALT/BTC pair, holding most altcoins essentially means shorting everything other than Bitcoin and maybe Ethereum.
If you want crypto exposure, just buy BTC and Eth. Due to their volatility, you'll want to have a healthy cash balance and target a constant fraction of that in exposure - essentially, selling half your coins if the price doubles and buying back double when the price halves. Read up on the Kelly Criterion for the full explanation as to why.
It's both. The correlation is too positive in dollar terms, and too negative once you back out the BTC correlation by repricing things in terms of BTC (which is usually the base currency in crypto-only trading pairs).
Yep. You'll see a few horror stories every week on https://www.reddit.com/r/CoinBase/ and usually once a horror story hits the front page of this sub-reddit (there are 2 horror stories today on the front page), then someone from Coinbase responds.
This is the case pretty much with all the top crypto-exchanges since the 2017 Holidays Media hype.
If you could transact in a basket of Crypto assets dealing with your brokerage instead of Coinbase, that sounds like you would be able to get better support if an issue occurred.
simply put its “Most Advanced Yet Acceptable” -- Raymond Loewy
I'm guessing its a user acquisition tactic for people who traditionally invest in mutual funds, ETFs, etc. this way they feel like they "understand" what they're buying into instead of actually needing to suffer through the learning curve of how blockchain works.
I see that, but there is a huge problem with this index that I'm amazed is not illegal. They control the index with the coins the same platform adds.
That is a major incentives no-no. Coinbase can make more money pumping coins into the index than managing the index itself. If I wanted and index'd solution for crypto, I would not use one like this.
You can still buy crypto through decentralized exchanges. Different investor types prefer different avenues. This is just one of the many that will be available in the future.
If you want crypto exposure, just buy BTC and Eth. Due to their volatility, you'll want to have a healthy cash balance and target a constant fraction of that in exposure - essentially, selling half your coins if the price doubles and buying back double when the price halves. Read up on the Kelly Criterion for the full explanation as to why.