Bitwise Files Chainlink ETF with SEC, Will Investors Get Easier Access to LINK Soon?

Bitwise Files for Chainlink ETF: A Potential Game-Changer for LINK Investors

Bitwise Asset Management, one of the most prominent names in digital asset investment, has taken another bold step toward bridging cryptocurrency and traditional finance. On August 26, 2025, the company filed a Form S-1 registration statement with the U.S. Securities and Exchange Commission (SEC), seeking approval to launch the Bitwise Chainlink ETF. If granted, this would be the first regulated exchange-traded fund (ETF) in the United States offering investors direct exposure to Chainlink (LINK), one of the most widely used blockchain oracle networks.

The filing marks a significant milestone, both for Bitwise and for the broader cryptocurrency industry. With Bitcoin and Ethereum ETFs already approved earlier this year, Chainlink’s potential entry into the ETF market signals a deeper recognition of altcoins as institutional-grade investment products.

What the SEC Filing Means

At its core, the filing represents Bitwise’s attempt to list shares of a Chainlink-backed trust on a national securities exchange. The trust itself is Delaware-registered and sponsored by Bitwise Investment Advisers, LLC, a subsidiary of Bitwise Asset Management.

Source: Official SEC Announcement

The ETF is designed to directly hold Chainlink tokens, with its net asset value (NAV) pegged to the CME CF Chainlink-Dollar Reference Rate (New York Variant). This benchmark reflects the fair market price of LINK and provides transparent price discovery, ensuring investors are exposed to the real market value of the asset rather than derivatives or synthetic products.

This is a key difference compared to unregulated crypto investment products. A regulated ETF would allow investors to gain exposure to Chainlink without dealing with the complexities of crypto wallets, private keys, or unregulated exchanges.

How the ETF Would Operate

According to the filing, the ETF will function in a manner similar to other spot crypto ETFs. Shares will be issued and redeemed in large blocks, called “baskets,” of 10,000 shares each. These baskets can be exchanged by Authorized Participants (APs), typically large financial institutions, who have arrangements with the fund.

APs may deliver Chainlink directly to the fund in exchange for ETF shares, or they may transact in cash by providing U.S. dollars. Importantly, the ETF will not engage in active trading or speculative strategies. Instead, it will act as a passive custodian of LINK, charging a management fee to cover operational and custodial expenses.

This structure makes the fund appealing for both institutional and retail investors who want exposure to LINK through a familiar, regulated investment vehicle listed on traditional stock exchanges.

Custody and Security: Coinbase in the Spotlight

Custody remains one of the most critical issues in crypto investment products. For this ETF, Coinbase Custody Trust Company, LLC will serve as the official custodian. Coinbase will hold the Chainlink tokens in cold storage wallets with multiple layers of security protocols.

The filing also indicates that Coinbase’s insurance policies will cover potential security breaches. However, like all crypto assets, the holdings will not be protected by the Federal Deposit Insurance Corporation (FDIC), which traditionally insures bank deposits.

The reliance on Coinbase Custody highlights how crypto-native firms have become essential partners for traditional financial products, serving as the infrastructure backbone that makes institutional adoption possible.

The Risks Investors Should Know

Despite the excitement surrounding the filing, the SEC document lays out several risks investors should consider before jumping in.

The most obvious is volatility. Chainlink, like other cryptocurrencies, is subject to dramatic price swings over short timeframes. While this volatility can generate large returns, it also exposes investors to significant downside risk.

Additionally, regulatory uncertainty continues to cast a shadow over the crypto industry. The U.S. government has not yet provided full clarity on whether certain tokens can be classified as securities. This lack of certainty could impact Chainlink’s legal status in the future.

Other risks include technological vulnerabilities—such as bugs in the Chainlink protocol—custody risks like the potential loss of private keys, and broader market adoption challenges that may influence LINK’s long-term value.

Why This Matters for Chainlink and the Market

For Chainlink, the ETF filing represents far more than a new investment product. It signals a growing recognition of the protocol’s real-world utility. As a decentralized oracle network, Chainlink provides the critical infrastructure that allows blockchains to connect with external data, powering smart contracts in decentralized finance (DeFi), gaming, insurance, and more.

An ETF would not only bring new liquidity and investor attention to LINK but also serve as a stamp of legitimacy in the eyes of traditional investors who may have been hesitant to enter the crypto space.

“Chainlink has been one of the most critical projects in the blockchain ecosystem for years,” said one digital asset strategist in an interview. “Bringing LINK into a regulated ETF structure gives institutions a way to bet on blockchain’s real-world use cases, not just speculative trading.”

Bitwise’s Track Record in ETFs

Bitwise is no stranger to innovation in the ETF landscape. The firm already manages several crypto-themed investment products, including funds tied to Bitcoin, Ethereum, and crypto market indexes. Its push for a Chainlink ETF aligns with its broader strategy of integrating digital assets into traditional financial portfolios.

In previous filings and statements, Bitwise executives have argued that ETFs serve as the bridge between Wall Street and blockchain, providing a safe and compliant way for investors to participate in the growth of digital assets.

Could Approval Be Around the Corner?

While the filing itself is a major step, approval is far from guaranteed. The SEC has historically been cautious about greenlighting crypto ETFs, citing concerns around market manipulation, liquidity, and investor protection.

However, the recent approval of spot Bitcoin and Ethereum ETFs may signal a shift in regulatory posture. If LINK follows in their footsteps, it could pave the way for a wave of altcoin ETFs, potentially including assets like Solana, Avalanche, or even stablecoins.

Market analysts suggest that approval of a Chainlink ETF could drive significant demand for LINK, potentially boosting prices as institutional capital flows into the asset. Yet, much will depend on how quickly the SEC processes the filing and whether it raises additional concerns.

The Bigger Picture: Crypto in Traditional Portfolios

Regardless of the SEC’s decision, the filing underscores a broader trend: crypto is no longer on the fringes of finance. With institutional products, custody services, and regulatory frameworks evolving rapidly, digital assets are increasingly seen as mainstream portfolio components.

For retail investors, a Chainlink ETF would offer a way to diversify into crypto without leaving the safety of regulated markets. For institutions, it would mark another step toward building crypto allocations at scale.

Whether this ETF gets approved in 2025 or faces delays, the message is clear: the boundary between crypto and traditional finance is disappearing, and companies like Bitwise are leading the charge.

Writer @Erlin

Erlin is an experienced crypto writer who loves to explore the intersection of blockchain technology and financial markets. She regularly provides insights into the latest trends and innovations in the digital currency space.

 

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