Crypto index fund, or build your own: design and backtest a custom crypto index.
Off-the-shelf crypto index funds hold a fixed, market-cap-weighted basket where Bitcoin dominates. Choose your own coins and weighting instead, backtest the basket against real history, and track it against BTC. No wallet, no trades.
Educational only · Never places a trade
In short
A crypto index fund is a single product that holds a market-cap-weighted basket of the largest cryptocurrencies, so one ticker gives you diversified exposure. The two main US exchange-traded options are the Bitwise 10 Crypto Index Fund (BITW, 0.75% a year) and Grayscale's CoinDesk Crypto 5 (GDLC, 0.59% a year), both heavily weighted toward Bitcoin. If you would rather choose the coins and the weighting yourself, you can build a custom crypto index, backtest it against real market history, and track it against BTC, without paying a fund fee. Indexes is that design-and-analysis step: it never holds coins and never places a trade.
Last updated July 2026
Crypto index funds
The main US crypto index funds, and what they hold
Two exchange-traded products cover most of the market. Both are market-cap weighted, which is why Bitcoin carries the largest share of each. Figures are as of July 2026 and can change, so confirm them on the vendor's page before you buy.
| Fund | Ticker | Expense ratio | Holdings | Weighting | Structure |
|---|---|---|---|---|---|
| Bitwise 10 Crypto Index Fund | BITW | 0.75% | Roughly the 10 largest crypto assets | Market-cap weighted, Bitcoin is the dominant holding | Exchange-traded product on NYSE Arca since December 2025 |
| Grayscale CoinDesk Crypto 5 | GDLC | 0.59% | About 5 assets (BTC, ETH, XRP, SOL, ADA) | Market-cap weighted, roughly 73% Bitcoin and 17% Ethereum | Uplisted to an exchange-traded product in September 2025 |
The catch with both funds is that you take the basket exactly as it is built. You cannot drop a coin you do not want, cap Bitcoin so it stops dominating, or equal-weight the holdings. Because market-cap weighting hands most of the index to the biggest asset, a broad crypto index fund often behaves a lot like simply holding Bitcoin, plus a small tail of altcoin risk and an annual fee. Whether that tradeoff is worth it is exactly the question our guide on whether crypto index funds are worth it works through.
Buy a fund or build your own
Buy a fixed basket, or design the index yourself
A fund gives you one-ticker convenience and holds the coins for you. Building your own gives you control over every rule and skips the expense ratio, at the cost of doing the maintenance. Here is the honest side-by-side.
| Buy a crypto index fund | Build your own with Indexes | |
|---|---|---|
| Who chooses the coins | The fund provider, from a fixed rulebook | You do, any coins you want |
| Weighting method | Market-cap only, so Bitcoin dominates | Market-cap, capped market-cap, or equal weight |
| Backtest before you commit | No | Yes, against real market history |
| Annual cost | 0.59% to 0.75% expense ratio | Flat software fee from $12/mo |
| Holds your crypto or places trades | Yes, you buy fund shares | No, it is analyze-only |
| Track against a BTC benchmark | Only the fund level | Yes, your index versus BTC over time |
| Best for | Hands-off, one-ticker exposure | Designing and testing your own basket |
Indexes is not a brokerage or a fund. It does not custody coins, connect to a wallet, or place a trade. It is the design-and-measurement step in front of any of those decisions: you build the basket, test it, and decide what you actually want before you commit real money anywhere. The full walkthrough is in how to build a crypto index.
How it works
Build a custom crypto index in four steps
Choose the coins
List the assets that belong in the index, for example the largest tokens excluding stablecoins, or a focused theme like smart-contract platforms. Write an explicit inclusion rule so it can be reproduced.
Pick a weighting
Market-cap, capped market-cap so no single coin dominates, or equal weight. This is the choice that decides whether your index tracks Bitcoin or spreads across the field.
Set rebalancing rules
Crypto weights drift fast, so choose a schedule, monthly or quarterly, and a tolerance band so you only reset when an asset has drifted meaningfully from its target.
Backtest and track
Run the rules over real market history to see the level and the drawdown, then keep the index live and compare it to BTC to see whether the diversification helped.
Weighting a crypto index
Why weighting matters more in crypto
In equities the largest company might be a few percent of a broad index. In crypto, one asset can be the majority of the whole market by value, so a plain market-cap index hands most of its weight to Bitcoin. That is fine if BTC exposure is what you want, but it means a diversified-looking fund can move almost in lockstep with a single coin.
Market-cap
The largest coin can dominate the entire index. Simple and what the funds use, but it concentrates you in Bitcoin whether you meant to or not.
Capped market-cap
Market-cap logic with a ceiling per asset, for example no coin above 30%, so the biggest name cannot swallow the basket and smaller assets still register.
Equal weight
Every coin counts the same. It spreads exposure but leans hard into smaller, more volatile names, which usually makes the index far bumpier.
You can test each of these with different weighting schemes on the same coins and watch the drawdown change, and the same market-cap versus equal-weight lesson from equities, covered in market cap vs equal weight, applies here with sharper edges.
Who builds crypto indexes here
What people design
A capped large-cap basket
Hold the largest coins but cap Bitcoin so the index is genuinely diversified rather than a BTC proxy with extra steps.
A themed crypto index
Express a theme like smart-contract platforms or DeFi, weight the members, and test it against the broad market.
Basket versus Bitcoin
Backtest a diversified basket against BTC to answer the honest question: did the extra coins actually beat just holding Bitcoin?
Stocks and crypto together
Weight BTC next to equities in one index and calculate the combined level. Most index tools cannot put both asset types in a single basket.
A rebalancing study
Test monthly against quarterly rebalancing on volatile coins and see how much the maintenance rule changed the result.
A tracked crypto index
Keep the basket live with a crypto basket tracker and follow its level against BTC over time.
Questions
Crypto index funds, answered
What is a crypto index fund?
A crypto index fund is a single product that holds a rules-based basket of cryptocurrencies, usually the largest assets by market value, so one purchase gives you diversified exposure instead of picking coins one at a time. Most are market-cap weighted, which means Bitcoin carries the biggest share. In the US the main exchange-traded options are BITW and GDLC.
Can you make your own crypto index fund?
Yes. Building your own crypto index means writing the same rules a fund uses: choose the coins, pick a weighting method, and set a rebalancing schedule. You pay no fund expense ratio and you control every choice, but you do the maintenance yourself. Indexes lets you design that basket, backtest it against real history, and track it, without holding any coins.
Are crypto index funds a good investment?
A crypto index fund suits someone who wants diversified crypto exposure in one ticker and does not want to manage a basket. The tradeoffs are the annual fee and heavy Bitcoin concentration, since a market-cap fund can behave a lot like just holding BTC. Whether it is worth it depends on how much you value the convenience versus the control and cost of building your own.
What is the best crypto index fund?
There is no single best one; it depends on what you want. BITW holds about ten assets at a 0.75% expense ratio, while GDLC holds about five at 0.59% and is even more concentrated in Bitcoin. If you want a specific set of coins or a weighting other than market-cap, no off-the-shelf fund will match it, which is the case for building your own index.
How much does a crypto index fund cost?
The two main US exchange-traded crypto index products charge an annual expense ratio: the Bitwise 10 Crypto Index Fund (BITW) at 0.75% and the Grayscale CoinDesk Crypto 5 (GDLC) at 0.59%, as of July 2026. That fee is charged on the whole balance every year. Building and tracking your own index avoids the expense ratio, though you handle the rebalancing yourself.
Is a crypto index fund better than buying Bitcoin?
A market-cap crypto index fund is dominated by Bitcoin, so it often moves much like Bitcoin alone, plus a slice of altcoin risk and an annual fee. Diversification helps when altcoins outrun Bitcoin and hurts when they lag. The honest way to judge it is to backtest a diversified basket against BTC as the benchmark and see whether the extra names actually paid off.
How many coins should a crypto index have?
There is no fixed rule, but most broad crypto indexes hold somewhere between five and thirty assets. Fewer coins means more concentration in the largest names; more coins pulls in smaller, more volatile assets. Because one asset can otherwise swallow a market-cap index, many designs add a cap, for example no single coin above 30%, to keep the basket diversified.
Go deeper
Design a crypto index and see how it behaves
Choose the coins, cap or equal-weight them, set the rebalancing, and backtest the basket against BTC over real market history. No wallet, no account, no trades. Crypto is highly volatile, and this is educational and informational only, not investment advice.