Please don’t skip this message — it only takes a minutes to read. Sorry to bother you, but time is running out.

Bitcoin is freedom. If you think independent, ‘bitcoin-only’ media is important, if you believe information and education about bitcoin matters for adoption, and if you have gained something from our work, we would be grateful if you could chip in $21. 

Join the 2% of our readers who occasionally make a donation. If everyone reading this donated just $21, we would reach our target in a couple of hours. $21 is all we ask for. To cover the cost for our servers, editors, writers, and thumbnail artists we rely on our readers’ generous support. 

How You can chip in:

  • Send sats as a tip to a writer. All of our writers have an active tipping widget.
  • Join our campaign on 
    Awesome perks are waiting for you such as the limited edition Bukele Blend Coffee from El Salvador.

Your support ensures that Bitcoin News stays independent with a laser focus on Bitcoin and only Bitcoin.


Coinbase Index Failure Reveals Crypto Index Fund Shortcomings

Coinbase Index Failure Reveals Crypto Index Fund Shortcomings

Support free writers: > send a tip

written by

The Coinbase Index, Coinbase’s version of a crypto index fund, is being pulled from the market. Apparently, there wasn’t enough interest in it and it didn’t make enough money to make it worthwhile, so the exchange is redirecting  resources. The Coinbase Index only launched in March 2018 and this failure reveals how crypto index funds may not yet represent an optimal investment.

The ideology behind the Coinbase Index is that institutional investors want a product where they don’t have to actually touch crypto but can invest in it in a safe and regulated way. The Coinbase Index included the five cryptocurrencies on Coinbase: Bitcoin, Ethereum, Litecoin, Bitcoin Cash, and Ethereum Classic, weighted by market cap. The index would automatically re-adjust the weight every month as the relative market cap of these currencies changed, so investors could essentially invest in the Coinbase Index and track the overall crypto market, much like investors invest in stock indices like the S&P 500 and NASDAQ to track the stock market.

The first downside was probably the requirement that investors be accredited and that they invest at least USD 250,000. This excluded all average investors and many wealthy ones that are not accredited. Accredited investors would be forced to invest a large sum of money to reach the minimum, instead of investing a little to get a taste for the crypto market.

Another problem with the Coinbase Index was that it wasn’t possible for investors to make their own decisions to optimize their portfolio, besides investing more in the index or divesting. Investors with large sums of investment would probably want more control over their portfolio.

Further, more discerning investors would prefer holding their own private keys. Even though the Coinbase Index is backed by crypto, investors cannot use the crypto in the index at will, as they do not truly own any of it.

Indeed, Coinbase has shifted its attention to offering the Coinbase Bundle, where investors can buy a bundle of crypto that they actually hold themselves. A major fix with the Coinbase Bundle is investors don’t have to be accredited and the minimum investment is USD 25. The Coinbase Bundle gives investors the freedom to buy, sell, and send the crypto as they wish. Circle is using a similar strategy, offering a bundle of 11 cryptocurrencies with a minimum investment of USD 10.

The Coinbase Index story shows that investors want to buy actual crypto instead of crypto indexes. Coinbase will be targeting institutional investors with a sales and support team, making custom strategies for each institutional investor, instead of the broad brush of a crypto index fund.


Follow on Twitter: @bitcoinnewscom

Telegram Alerts from

Want to advertise or get published on – View our Media Kit PDF here.

Image Courtesy: Pixabay

Help spread this article :) is NOT INVESTMENT ADVICE

Opinions expressed are entirely their own and do not necessarily reflect those of

For informational purposes only. Individuals and entities should not construe any information on this site as investment, financial, legal, tax, accounting or other advice. Information provided does not constitute a recommendation or endorsement by to buy or sell bitcoin, cryptocurrencies or other financial instruments. Forecasts are inherently limited and cannot be relied upon. Do your own research and consult a professional advisor. The opinion of authors do not reflect those of 


bitcoin shop miami

Read More Bitcoin News

Hayek And Bitcoin

Hayek and Bitcoin

Hayek passed long before Bitcoin’s inception, but in his book The Denationalisation of Money, he argued for nothing short of stripping the state of its monopoly power of money itself.

Read More »


bitcoin shop miami

Join our Newsletter

Video of the Week


Latest on Bitcoin News

Join our Newsletter