The six funds offered distribution rates as high as 25.93% while showing 0% SEC yields. Most payouts were return of capital. Holders face cash redemption by Aug. 10.
Friday, July 31, was the final trading day for six Bitwise option-income ETFs. Shareholders still holding shares as of Aug. 3 face automatic cash redemption rather than an exchange sale.
Board members voted June 30 to liquidate ICOI, IMRA, IMST, IGME, ICRC, and IETH, according to an SEC prospectus supplement. The products use option-income strategies tied to Coinbase, Marathon Digital, Strategy, GameStop, Circle, and Ethereum. Creation and redemption orders stopped after the July 31 close.
Bitwise's corrected timetable puts the final net asset value calculation on Aug. 7 and expects proceeds to reach investors through brokers on or around Aug. 10. Shares still held as of Aug. 3 are slated to be redeemed for cash at the fund's NAV. The SEC filing says shareholders generally recognize a capital gain or loss.
Bitwise reported annualized distribution rates between 11.15% for IETH and 25.93% for IMST in its April 23 payout estimate. Every fund's 30-day SEC yield was 0%. The distribution rate annualizes the latest monthly payment and divides it by recent NAV; Bitwise says that figure is not total return.
Return of capital is Bitwise's estimate of the portion representing an investor's original investment. The issuer says distributions can reduce NAV and trading price. Bitwise estimated that the April payouts for five funds – ICOI, IMRA, IMST, ICRC, and IETH – were 100% return of capital. IGME was estimated at 0%. The mix changed in the May estimate, when IMST was put at 23.01% return of capital and ICRC at 0%. Four peers remained at 100%. By the June 25 distribution notice, Bitwise estimated all six payouts as 100% return of capital, again with a 0% SEC yield. Annualized distribution rates had moved to a range of 7.44% to 22.36%. The same notice reported since-inception returns from -14.45% for IGME to -58.34% for IETH.
Official fund pages dated July 26 through July 29 showed about $23.1 million of combined pre-liquidation AUM. Their latest displayed NAVs ranged from $7.22 for IMST to $22.82 for IGME. Month-end figures as of June 29 put cumulative NAV returns since inception between -12.47% for IGME and -66.11% for IMST.
These figures are snapshots from different dates, leaving July 31 closing assets, liquidation values, and lifetime returns unknown. Available disclosures leave the board's reason for closing the funds unanswered.
Holders will receive an amount depending on the final NAV scheduled for Aug. 7, with cash expected around Aug. 10.
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