Five of This Fund's Ten Holdings Add Up to 1.12%

BITW is marketed as ten crypto assets in one ticker. Open its Form 10-Q for 31 March 2026 and the schedule of investments reads like this:

Bitcoin 76.73%. Ethereum 14.31%. XRP 4.66%. Solana 2.67%. Cardano 0.50%. Chainlink 0.35%. Litecoin 0.24%. Avalanche 0.22%. SUI 0.19%. Polkadot 0.12%.

Add up the bottom five. It comes to 1.12%.

Polkadot at 0.12% means the entire position could double overnight and the fund would move by twelve basis points. That is not a holding in any sense that affects your returns. It is a line in a filing.

If you bought a ten-asset crypto fund because ten sounded better than one, this is the part worth knowing before the next market cycle teaches it to you.

Now Compare It With a Fund Half the Size

GDLC holds five assets, not ten. Reasonable assumption: it must be the more concentrated of the two.

It is not.

	BITW	GDLC
Holdings	10	5
Bitcoin weight	76.73%	74.24%
BTC + ETH	91.04%	90.39%

The fund with twice as many holdings holds more bitcoin.

That inversion is the most useful fact in crypto index investing and almost nobody mentions it, because it destroys the one number everybody compares.

Why It Happens

Two mechanisms, pulling the same way.

GDLC has a brake. The CoinDesk 5 methodology caps any single asset at 75% and redistributes the excess at each quarterly rebalance. With bitcoin sitting in the low-to-mid seventies, that cap is close to binding. It is doing real work.

BITW has an accelerator. Its index applies no weight cap at all, so bitcoin's free-float market cap share flows straight through. And since August 2026 the methodology requires at least 87.5% of index weight to sit in assets that are the primary underlying of an SEC-approved exchange-traded product. Those are the largest, most established names. The rule pushes weight toward bitcoin and ether rather than away.

So one product is designed to resist concentration and the other is designed to accept it and then reinforce it with a regulatory floor. Neither is wrong. They are different theories about what an index fund is for, and the constituent count communicates neither of them.

The Arithmetic Nobody Runs

Here is why a 1.12% tail cannot matter, expressed as a day's trading.

Say Chainlink has a huge session and gains 15%. It sits at 0.35% of the fund, so it contributes 0.05% to the index. Meanwhile bitcoin, at 76.73%, drifts down 1%. That subtracts 0.77%.

The small holding had its best day in months and it was erased fifteen times over by a nothing-day in bitcoin.

This is not a flaw in either fund. It is what market-cap weighting produces in a market where bitcoin dominance sits near 57 to 59%, and above 64% once stablecoins come out of the denominator. The index holds a mirror up to the market and the mirror is accurate.

But "accurate" and "diversified" are different goals, and most index marketing quietly implies you are buying both.

What to Look At Instead of the Count

One number, and it takes ten seconds.

Open the fund's holdings page and add up the weight of bitcoin and ether. Not how many rows there are. The weight of the top two.

If it is above 85%, you own something that will behave like a two-asset portfolio regardless of what the fact sheet says. Every daily move you see will be bitcoin and ether with a rounding error attached.

Both of these funds are above 90%.

The Rule That Makes BITW Genuinely Unusual

Worth a closer look, because it is the strangest thing in either product and it is not hidden, just unread.

The 87.5% floor has a second layer. On each NYSE Arca trading day, the index checks its holdings at 12:00 p.m. Eastern. If the approved-components share has fallen below 86%, a rebalance fires at 4:00 p.m. the same day.

Think about what makes that share fall. The most likely cause is a non-approved asset rallying hard. Which means a strong day for one of the smaller holdings is exactly what triggers the trim.

The index does not let that position run. It cuts it back the same afternoon.

There is a second consequence that is easier to miss. When the SEC approves a single-asset ETP for a new coin, that coin's eligibility for a larger index weight changes overnight, with nothing happening to its price, supply or fundamentals. A market-cap index with a regulatory calendar as an input is an unusual object, and if you hold BITW you hold that input whether or not you knew about it.

Why Monthly Rebalancing Costs Less Than You Would Think

One genuinely reassuring finding from the filings, since the rest of this article has been sceptical.

BITW rebalances monthly, three times as often as GDLC's quarterly cadence. You would expect heavy turnover and heavy execution cost.

Its reported portfolio turnover has run around 3%. The Digital Assets category average is closer to 67%.

The reason explains something fundamental about cap-weighted indexes. When weights are set by market capitalisation, prices do most of the rebalancing for you. If bitcoin rises 20% while everything else is flat, its weight rises automatically and the index simply records what already happened. Actual trading is only needed when constituents change or when weights drift in a way prices did not cause.

There is also a buffer suppressing constituent churn: a challenger must beat an incumbent's free-float market cap by more than 10%, on each of five consecutive days up to the record date a week before the rebalance. A brief spike past an incumbent does not trigger a swap.

So the monthly cadence is much cheaper in practice than its frequency implies. That is a real point in BITW's favour and it took reading the filing to find it.

If You Actually Wanted Less Bitcoin

Neither fund solves that, and comparing them more carefully will not change it.

Three routes that do, each with a cost.

A capped index. The CoinDesk 20 caps its largest constituent at 30% and every other at 20%, targeting roughly half the index in BTC and ETH combined and half across the other eighteen assets. The cost: it underperforms an uncapped basket every time bitcoin leads, which has been most of the recent past.

An ex-bitcoin basket. Remove bitcoin from the weighting entirely and you see what the rest of the market is doing on its own terms. The cost: you have given up exposure to the asset that has driven most of the market's returns.

Two positions instead of one. Hold a concentrated product and a separate alt sleeve, and set the ratio yourself. The cost: two things to manage and rebalance.

The Part Both Issuers Will Never Write

Bitcoin and ether are roughly 90% of both funds. Single-asset spot ETFs for each exist at fees in the 0.15% to 0.25% range. BITW charges 0.75% and GDLC charges 0.59%.

Hold BTC and ETH through two cheap ETFs at 90% of your intended weight and you have replicated most of either fund for a fraction of the cost. What you give up is the tail, automatic rebalancing between the two, and having one line on your statement instead of two.

On a small position held briefly, that trade favours the fund. On a large one held for a decade, it does not, and the gap is not small.

Neither issuer is going to run that comparison for you. It belongs next to the fee table anyway.

The Takeaway

Constituent count is the least informative number on any crypto index fact sheet. It is also the one that gets compared most, because it is the easiest.

What decides how a fund behaves sits in the methodology: weight caps, regulatory floors, rebalance rules and buffers. None of those appear in the fund's name, and a ten-asset product with no cap and a floor pushing weight upward is more concentrated than a five-asset product with a cap that binds.

The filings say all of this plainly. They are free, they are searchable, and reading one takes less time than reading three comparison articles about it.

Methodology detail for both benchmarks is on our Bitwise 10 and CoinDesk 20 pages.

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BITW holdings from SEC Form 10-Q dated 31 March 2026. GDLC weights from an October 2025 filing. Fees as of September 2026. All figures change at each rebalance and filing. Cryptoindex.ai is not affiliated with Bitwise or Grayscale and receives no compensation from any fund issuer. Nothing here is investment advice.