Finst

Hashdex Shuts Down U.S. Bitcoin ETF DEFI After Weak Inflows

DEFI was the smallest U.S. spot Bitcoin ETF and drew the least inflows. Hashdex will sell the remaining bitcoin and distribute the proceeds to shareholders.

By Mike Hesp
• 2 min read
Hashdex Shuts Down U.S. Bitcoin ETF DEFI After Weak Inflows

Key Takeaways

  • Hashdex is shutting down its U.S. spot Bitcoin ETF DEFI, with the last trading day set for August 17.
  • After that, the fund will sell its remaining bitcoin and distribute the proceeds to shareholders.
  • DEFI was the smallest U.S. spot Bitcoin ETF and posted the lowest cumulative net inflows.

Hashdex is closing its U.S. spot Bitcoin ETF DEFI. Its final trading day will be August 17. After that, the fund will liquidate its remaining bitcoin and pass the proceeds on to shareholders, according to a filing with the U.S. Securities and Exchange Commission.

Smallest Fund Is Going Away

DEFI was the smallest U.S. spot Bitcoin ETF by net assets and also recorded the weakest cumulative net inflows, according to SoSoValue data. By comparison, the second-smallest fund, WisdomTree's BTCW, has $142.4 million (€123 million) in net assets, while market leader BlackRock's IBIT sits at $47.08 billion (€40.8 billion).

The shutdown highlights how much the market has concentrated around the largest products. The total U.S. spot Bitcoin ETF market now holds $77.6 billion (€67.3 billion) in net assets and has taken in $51.5 billion (€44.6 billion) in cumulative net inflows.

Competition Became Too Tough

Hashdex arrived later than many of its competitors. The fund launched in September 2022 as a Bitcoin futures ETF and did not convert to a spot product until the end of March 2024, nearly three months after IBIT debuted. Its fee structure also gave investors little reason to choose it over rivals, since the 0.25% expense ratio matched BlackRock's and Fidelity's.

That late start, combined with limited differentiation, made it difficult for DEFI to gain traction in a market where the biggest names capture most of the institutional money. Across the broader U.S. spot Bitcoin ETF landscape, most inflows have gone to IBIT, with Fidelity's FBTC next in line, while Grayscale's GBTC has seen billions in outflows.

What This Means for Investors

For European crypto readers, the key point is that this does not signal fading demand for U.S. spot Bitcoin ETFs. Shutting down one small fund instead reflects a market where scale, brand recognition, and distribution are becoming increasingly important. Hashdex is still active in the U.S. and manages more than $200 million (€173 million) through other products, including the diversified Hashdex Nasdaq Crypto Index US ETF (NCIQ).

Disclaimer: This content is for informational purposes only and does not constitute financial, investment, legal, or tax advice. The information provided may be incomplete, inaccurate, or outdated and should not be relied upon as such. Nothing on this website should be considered a recommendation to buy, sell, or hold any cryptocurrency. Investing in crypto-assets involves risk of loss.