After hinting at the product for a couple of months, it has been finally divulged that Amun, a London-based fintech firm, will be listing the world's first multi-crypto exchange-traded product (ETP) in Switzerland.
November 19, 2018 | AtoZ Markets - The leading stock exchange in Switzerland SIX Swiss Exchange has released the world’s first multi-cryptocurrency-based exchange-traded product (ETP), and it is expected to hit the market next week. This is in accordance with the report from the Financial Times (FT).
Amun's Crypto ETP Will Track Five Leading Digital Assets
The first worldwide multi-crypto ETP will track, according to the report, the five leading cryptocurrencies: Bitcoin (BTC), Ripple (XRP) Ethereum (ETH), Bitcoin Cash, (BCH) and Litecoin (LTC). According to the plan, the ETP will have the backing of the Swiss startup Amun AG, and will also be listed under the index HODL.
As per Financial Times, each cryptocurrency will be listed to attain a market share within the forthcoming ETP. Moreover, Bitcoin, the flagship cryptocurrency will account for about 50% of the ETP’s assets, while the rest will be divided into fractions among the other four.
For instance, XRP will acquire 25,4% and Ethereum approximately 16,7%. Meanwhile, Bitcoin Cash and Litecoin will respectively acquire only 5,2% and 3% of the ETP.
The co-founder and chief executive of the London-based fintech firm, Amun, Hany Rashwan, asserted that the upcoming ETP has been designed to stick to the same strict rules and policies that are required by traditional ETPs. Rashwan further explained what the new multi crypto ETP will offer. He was quoted as saying:
“Amun’s EUN will offer institutional investors limited to investing only in securities or will not want to establish custody for the exposure of digital assets to cryptocurrencies; it will also provide access to retail investors who currently do not have access to trade crypts due to local regulatory impediments.”
SIX Swiss Exchange, according to Amun’s official website, is the fourth biggest stock exchange in Europe with a market capitalization of $1.6 trillion. Moreover, the Swiss news agency Finews.com has revealed that the index would be managed by the German index unit of the investment firm, Van Eck.
ETF or ETP?
Many had thought that the key to getting institutions onboard is through an ETF, however, an ETP could as well be an alternative. According to the definition of Investopedia, ETPs are a type of security that can be priced derivatively and also trades intraday on a national securities exchange.
It further states that the values of ETPs are derived from investment tools such as a commodity, a currency, a share price, or an interest rate. They can be actively managed funds that include exchange-traded funds (ETFs), and others.
Sweden Already Launched ETN
In a connected news, Sweden already created an Exchange Traded Note (ETN). It is dubbed Bitcoin Tracker One and is now quoted in US dollars under the ticker CXBTF. It has attracted about $1 billion since it started trading on the Swedish exchange Nasdaq Stockholm back in 2015.
Nevertheless, in the upcoming months, institutions could get several options to venture into the crypto market. One of the alternatives can be through the ETP, as Bakkt is set to launch during December and SEC will most likely give their approval to an ETF during the first quarter of 2019.
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