With crypto markets plummeting more than 50% in 2022, 21Shares has reportedly introduced its new risk-adjusted crypto investment tool as a replication effort of S&P Dow Jones Indices’ benchmarks.

Specifically, The Switzerland-based crypto investment entity 21Shares has reportedly rolled out two fresh exchange-traded products (ETP), providing investors exposure to the top-tier cryptocurrencies – Bitcoin (BTC) and Ether (ETH) – and at the same time seeking to bring down volatility through rebalancing assets to the United States dollar.

The two new offerings, the 21Shares S&P Risk Controlled Bitcoin Index ETP and 21Shares S&P Risk Controlled Ethereum Index ETP, will reportedly be available for trading on the Swiss SIX Exchange on July 20th. The ETPs will trade under tickers SPBTC and SPETH. 

Both ETPs reportedly aim for a volatility level of 40%, which is reachable via dynamically rebalancing or allocating more assets to USD when volatility inclines. 

The products work towards a goal of replicating S&P indexes’ benchmarks that keep tabs on risk via carrying out adjustments to the exposure to the underlying index and dynamically allocating to U.S. dollars.

21Shares’ director of ETP, Arthur Krause, reportedly highlighted that the 40% target is a reference to volatility, instead of investment performance. Krause further stated that large-cap equities in America serve as a demonstration of the yearly historical volatility of 20%. For Bitcoin, this figure stood at 70%, while Ether’s volatility amounted to 80%. 

“The 21Shares S&P Risk Controlled Index ETPs combines exposure to a volatile cryptocurrency with cash — which has zero volatility — to attempt to achieve the overall target of moderate volatility.”

Sharon Liebowitz, senior director of innovation at S&P Dow Jones Indices, reportedly revealed the company’s active involvement in crypto throughout the past years. In 2021, S&P rolled out a cryptocurrency index tracking crypto market performance. SPBTC and SPETH are instances of indexes designed to tackle volatility that comes with underlying cryptocurrencies.