Token assets are the underlying constituent members of a watermelon Fund. These token assets are exclusively Ethereum blockchain tokens implementing the ERC20 standard token interface.
In its governance capacity, the Technical Council determines the watermelon Fund asset universe, in that it periodically analyzes the broader Ethereum token universe, seeking eligible tokens given their exchange membership, liquidity and underlying use in the context of asset management.
Technically, a watermelon Fund can hold any ERC20 compliant token. However, not all ERC20 compliant tokens are appropriate for watermelon Funds to hold due to lack of a market, current pricing, exchange listing, liquidity, etc.
ETH is not ERC20
It should be noted the the Ethereum native asset, ETH, does not comply with the ERC20 token standard. For this reason, market observers may occasionally see “Wrapped ETH” or “WETH”, where ETH is itself held in an ERC20 compliant wrapper contract, so as to have the same behavior when participating in smart contract infrastructure that expects the ERC20 interface. As such, the watermelon Fund cannot hold native ETH, but can only hold WETH. This has no impact on the valuation of ETH and will function and be valued like-for-like in the watermelon Fund.
Note on Gas
It should be understood that non-view function interaction with an Ethereum smart contract requires the payment of gas for processing capacity. Gas is priced (dynamically according to network load and capacity) in ETH, so some amount of ETH in a calling address is required. Depending on the complexity and computational intensity of a smart contract, it is possible that non-trivial amounts of ETH may be required.
Please refer to the Asset Registrar for more details.