ETC Group, a London-based investment firm dedicated to financial services announced that it will include a Bitcoin exchange-traded product (ETP). Centrally licensed in Deutsche Börse’s Xetra eCommerce market later this month.
In a press release released by HANetf, the launch will take place in late June. As it is awaiting regulatory approval by BaFin, the German financial regulator.
ETC Group ensures that the product will be the first ETP to be launched on the Xetra platform
According to HANetf and ETC Group, the product will be the first Bitcoin ETP to be launched on the Xetra platform, as well as on the HANetf issuance platform. Physically backed, the Bitcoin Exchange Traded Crypto (BTCE) It tracks the price of bitcoin and has a 2% Total Spending Ratio (TER).
Bitcoin trading through an ETP structure eliminates the technical challenges associated with cryptocurrency: such as creating a wallet or trading or unregulated exchange. It also eliminates the need to manage cryptographic keys or participate with Blockchain technology.
BaFin recognized cryptocurrencies as financial instruments
The launch comes after BaFin announced on March 2 that it officially recognizes Bitcoin and cryptocurrencies as financial instruments.
“A significant step in the official recognition of the important role that cryptocurrencies have been playing in world markets in recent times.”
Bradley Duke, CEO of the ETC Group, commented: “Crypto sector has been slowed by concerns about complexity, accessibility, and governance“
“With BTCE, we are transporting bitcoins to the fold of the main regulated financial markets. Investors get the benefits of trading and owning Bitcoins through regulated security while still having the option to redeem Bitcoins if they so choose.“
The primary reason investors will choose to trade an ETP rather than physically trade the underlying asset is the structure of the product. The use of a regulated exchange trading platform like Xetra will allow traders to interact with a familiar platform. While gaining access to a new asset class to hedge risks.
Not to mention, buying and selling Bitcoin is complicated and highly risky for average investors. For those investors who wouldn’t mind the challenge, they can invest their BTCE bets in the underlying Bitcoin when they need it, according to the announcement.
BTCE tracks Bitcoin price
The BTCE tracks the price of BTC. The Bitcoin supporting this asset will be cold-stored by the custodian of BitGo digital assets.
Bradley Duke also added:
“The cryptocurrency sector has been slowed by concerns about complexity, accessibility, and governance. With BTCE, we are taking Bitcoin to the main regulated financial markets. Investors reap the benefits of trading and owning Bitcoin through a regulated security, while they have the option to trade Bitcoin if they so choose. ”