- WisdomTree launches EPXC, a tokenized digital fund using an SPY-linked options writing strategy, available to retail and institutional investors.
- The fund targets premiums of 2.5% every two weeks, with the aim of generating income and managing downside volatility compared to traditional equity strategies.
- EPXC is the fifteenth tokenized fund, expanding WisdomTree’s blockchain offerings to Ethereum, Avalanche and Base, reflecting the growing adoption of tokenized financial products and stablecoins.
WisdomTree has launched the WisdomTree Equity Premium Income Digital Fund, tokenized as EPXC and listed as WTPIX, available to institutional and retail investors through its Prime and Connect platforms.
The fund seeks to track the Volos US Large Cap Target 2.5% PutWrite Index before fees and expenses, using a put strategy with cash-secured options linked to SPY. This approach has long been used by professional investors to aim for higher returns while managing stock market volatility.
WisdomTree already runs a traditional fund tracking the same benchmark and notes that this on-chain digital version offers potential for enhanced risk-adjusted returns compared to exposure to the S&P 500 or similar covered call strategies.
Fund tokenization allows investors familiar with digital assets to access regulated exposure to real-world assets without leaving blockchain infrastructure. EPXC is the fifteenth tokenized fund available on WisdomTree’s platforms, offering users options for diversification and income-generating allocations.
The fund aims to generate income through bi-weekly premiums earned by writing SPY-linked puts, targeting a 2.5% premium. This structure is intended to perform relatively well in stable or declining stock market environments by relying on option premium income rather than market appreciation alone.
Related: Citadel tokenized stock warning puts DeFi in crosshairs of federal rulemaking
EPXC and market implications
WisdomTree highlights that exposure to derivatives and blockchain involves risks, including volatility, liquidity constraints, cybersecurity threats, and possible recordkeeping or regulatory issues within distributed ledger systems. Investors are encouraged to read the prospectus to understand the full risk profile. The fund is distributed by WisdomTree Securities, Inc.
The company continues to expand its tokenization efforts, operating 15 funds on Ethereum, Avalanche and Base. Its Government Digital Money Market Fund is the most active, currently holding more than US$730 million (A$1.124 billion) in assets. Some in the industry view this growth as part of a broader trend, reflecting the growing adoption of tokenized financial products and the growing role of stablecoins within the digital asset ecosystem.
Related: IMF warns that fragmented global rules could harm stablecoin market stability
