Europe leads the way with ETPs

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While the SEC ponders what to do about Exchange Traded Products (ETPs). The Swiss Stock Exchange SIX has announced that it will list the world’s first multi-crypto-based exchange-traded product. SIX is Europe’s fourth largest exchange.

What is an ETP?

ETPs are securities traded on a national securities exchange. Their pricing derives its value from other investment instruments, most commonly found in the form of commodities, stocks and indexes.

The first ETP listed at SIX is backed by Amun AG, a Swiss startup, and has the ticker HODL. According to the announcement, the ETP will track five of the sector’s biggest cryptocurrencies: BTC, XRP, ETH, BCH and LTC. Each cryptocurrency will acquire a certain market share within the upcoming ETP, with bitcoin accounting for around 50 percent of the ETP’s assets. The others will be divided as follows: 25.4% for XRP, 16.7% for ETH, 5.2% for BCH and 3% for LTC.

Amun’s co-founder and chief executive, Hany Rashwan, explained that the fund is organised in such a way that it complies with the strict policies governing traditional ETPs. It is hoped that this will start to lower the barriers to entry for other product launches and speed up mass adoption in the crypto sector.

This is not the first time a European country has launched a crypto ETP. Sweden’s XBT provider has been running the CoinShares exchange traded product since 2015 and it has proved itself to be very lucrative. Sweden, which is fast becoming a cashless society and is one of the more open-minded jurisdictions when it comes to crypto, is a leader in encouraging fintech innovation.

CoinShares offers two BTC trackers that trade in both Euros and Swedish Krona. According to Cointelegraph: “The product ascribes 200 shares as equal to the price of one Bitcoin for trading in Swedish krona and 20 shares to one Bitcoin for the euro version. The product is accessible to investors from across Europe and has attracted over $1 billion since its 2015 listing on Nasdaq Stockholm. “ Such is its success that leading developers have launched additional versions in Denmark, Latvia, Finland and Estonia.

Meanwhile, in the US, the battle over crypto ETFs continues and so far no ETF submission to the SEC has been successful.

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