The UK’s first cryptocurrency exchange traded notes (ETNs) have finally launched on the London Stock Exchange today.
Wisdomtree, 21shares and Invesco all received approval from the Financial Conduct Authority last week to launch the products at midday today, though these instruments will only be available to professional investors
Others are soon expected to join them, including ETC Group and Coinshares, which have also applied to list their own crypto products on London’s market.
ETNs are similar to exchange-traded funds (ETFs) but rely on unsecured debt securities issued by a bank, meaning that they do not directly hold the assets they track.
They were developed in 2006 by Barclays Bank and pay investors based on where the index they follow ends up, making them derivatives.
Only ETNs that track bitcoin and ethereum, the two most popular cryptocurrencies, are allowed on the exchange.
21shares launched four different exchange traded products on the London Stock Exchange today, in both pounds and dollars, with ‘core’ bitcoin and ethereum products, along with a ‘staking’ ethereum ETN.
Tobi Opeyemi Amure, a senior analyst at Trading.biz, described the move as a: “Major milestone for the UK to adopt institutional crypto”.
“There are no longer regulatory limitations that have hindered professional investors a chance to gain cryptocurrencies exposure,” he added.
The move comes after the US Securities and Exchange Commission approved the listing of spot bitcoin ETFs, which already hold combined assets of around $50bn.
Ophelia Snyder, co-founder of 21shares, said: “The UK is one of the deepest, most-liquid capital markets in the world. As institutional interest in cryptocurrencies grows, it is only natural that London Stock Exchange hosts responsible, properly-constructed funds offering access to these markets.
“That’s where an established firm like ours, with a proven track record through volatile markets, can play an integral role. We have listed more than 40 ETNs on 11 different stock exchanges. We are excited to be part of this evolution in the UK.”