Key Highlights:
- REX Osprey DOGE ETF ($DOJE) expects to launch Thursday as per Eric Balchunas.
- The ETF will invest at least 80% in Dogecoin. using the ’40 Act structure for faster approval.
- Analyst predict that $DOJE could kick off a new meme coin ETF era.
The meme coin market is now entering a new territory as REX Shares is planning to launch the first ever U.S. ETF that is linked to Dogecoin. This memecoin ETF will be called the REX Osprey DOGE ETF (DOJE), which according to Eric Balchunas, Senior ETF Analyst at Bloomberg, is set to list on Thursday under the Investment Company Act of 1940 or the “40 Act”. This ETF will be amongst the few crypto ETFs in the U.S. that will be regulated under the ’40 Act’ rather than the standard ’33 Act rules’.
As mentioned above, the news was first highlighted by Eric Balchunas, and it just shows how quickly the entire industry is expanding crypto ETFs beyond major tokens like Bitcoin, and Ethereum. Unlike these well-known coins, Dogecoin had started as an internet joke, but was driven this far by its community and viral culture than the technology. This is the only reason why this fund’s debut makes it unusual. Moreover, this ETF will be the first U.S. ETF that is based on an asset that does not have any staunch utility.
As soon as this new development was made public the price of the token experienced an uptick of almost 5%. At press time, the price of the token stands at $0.2454 with an uptick of 3.25% in the last 24 hours as per CoinMarketCap.
Structure and Mechanics of DOJE
According to early filings, the REX Osprey DOGE ETF will track the performance of Dogecoin itself. At least 80% of the fund’s assets will be held directly in DOGE only and the rest might be kept in cash or short-term securities so it can help with liquidity and redemptions. The fund is said to charge a 1.5% expense ratio, which is similar to what other specialized crypto ETFs typically cost.
Since the fund has not yet been launched, important details such as the big-ask spreads and average trading volumes are not available. The ETF might be listed on a U.S. exchange by Thursday. Similar to the earlier REX Social Strike ETF (SSK), the DOGE fund is registered under the ’40 Act, which lets it move forward without facing the SEC’s current delays on open-ended crypto ETFs that fall under the 1933 Act.
For now, the ETF will not use leverage, derivatives, or currency hedges. Instead, it will provide direct exposure to spot Dogecoin, setting it apart from more complex products that rely on futures contracts or synthetic strategies.
A New Chapter for Meme Coins
If the investment product is launched as scheduled, DOJE will be making history as the first U.S. exchange-traded fund to directly hold a meme cryptocurrency. The Bitcoin and Ethereum ETFs have been considered to be institutional bridges for “serious” crypto adoption, a Dogecoin fund will definitely add an element of unpredictability to the mix.
As we all know, Dogecoin has been fuelled by social buzz and celebrity shoutouts from Elon Musk especially. These prices move without regard to fundamentals, which make them some of the most volatile cryptocurrencies. By turning DOGE into a regulated ETF, REX is giving investors a way to bet on and probably formalize the known community driven momentum.
On one hand, critics are arguing that such ETFs could bring in risky speculations into the regulated markets. This notion comes up mainly because the DOGE token lacks real utility and strong developer support when compared to other blockchains such as Ethereum and Bitcoin. Supporters, on the other hand, argue it meets clear demand, if investors can trade meme stocks or sentiment-based ETFs, then a memecoin ETF is just as valid.