First Meme Coin ETF Launches With Dogecoin
The first meme coin ETF (Exchange-Traded Fund) has officially started trading, aiming to bring meme coins to a broader audience of investors, including small private savers. Some consider this an important step in recognizing meme coins as a legitimate investment tool, while others see it as another form of speculative trading with high fees. The exchange-traded fund is based on dogecoin, the best-known cryptocurrency of its kind.
DOGE ETF launch details
The ETF with the ticker DOJE debuted on Thursday, September 18, after the US Securities and Exchange Commission (SEC) raised no objections during the regulatory 75-day review period, effectively clearing the way for its launch. [1]
The fund was launched by Rex Financial, an issuer managing $8 billion in assets, in partnership with Osprey Funds, a crypto specialist known for over-the-counter and private placement digital asset funds.
The ETF offers investors direct exposure to dogecoin’s spot price through shares, making it possible to access the cryptocurrency without the need to manage digital wallets or hold the asset directly.
Market reaction to DOJE debut
Eric Balchunas, a senior Bloomberg analyst, noted on X that trading volume on DOJE’s debut was “shockingly solid,” adding that “most ETFs trade under $1 million on day one.” [2]
The ETF opened its first session at $26.51 per share but ended the day slightly lower at $26.37, a 0.53% drop. Pre-market trading at the start of the new week began just above $22 and was slowly moving toward the $23 level.
Supporters and critics divided
The launch of the meme coin ETF has sparked criticism from parts of the investment community. “I think it’s dangerous,” said Bryan Armour, director of passive strategies research for North America at Morningstar, in an interview with the Financial Times. He argued that such launches normalize collectibles. “Dogecoin seems to be a fad, like beanie babies or baseball cards,” he added. Armour warned that “this creates confusion for investors” and questioned whether meme coin ETFs would stop at dogecoin: “Should we expect a Labubu ETF next?”
On the other hand, Greg King, chief executive of Rex Financial, defended the move: “The digital asset revolution is already under way. To be able to offer exposure to some of the most popular digital assets within the protections of the US ETF regime is something Rex-Osprey is proud of and has worked diligently to achieve,” he told the Financial Times.
Nate Geraci, president of NovaDius Wealth Management, also sees a bright future for meme coin-backed ETFs: “Dogecoin is currently the sixth-largest non-stablecoin crypto asset by market cap. Regardless of its perceived utility, there is undeniable interest. While this may seem like an audacious launch, it’s likely just the beginning.” He expects that the SEC will approve more such launches in the near future.
Sources:
[1] https://www.ft.com/content/9ce02f45-1060-46a1-b37f-218d0037e621