With emerging regulations coming into place, institutional solutions to cryptocurrency investing are on the rise. Launched Aug. 15, U.S. investors are now able to invest in a fully-regulated Bitcoin ETN.
Big Win for Bitcoin, Crypto Crowds Wall Street
XBT Provider AB has released an exchange-traded note (ETN), called Bitcoin Tracker One, to U.S. investors, reports Bloomberg. XBT Provider AB is a majority-owned subsidiary of CoinShares Holdings Ltd.
Initially launched in 2015, Bitcoin Tracker One (CXBTF) is listed on the Nasdaq Stockholm Exchange and was previously only available for trading in euros and the Swedish krona. The Bitcoin ETN is now quoted in U.S. dollars, making it available to American investors.
Similar to buying an American depositary receipt, traders can purchase Bitcoin Tracker One as a foreign-listed asset available for exchange in U.S. dollars.
In an interview with Bloomberg, Ryan Radloff, CEO of CoinShares Holdings, said:
“Everyone that’s investing in dollars can now get exposure to these products, whereas before, they were only available in euros or Swedish krona. Given the current climate on the regulatory front in the U.S., this is a big win for Bitcoin.”
U.S. investors have long awaited Bitcoin exchange-traded funds (ETFs) to gain regulatory approval and reach markets, as they are considered a potential catalyst for incoming institutional capital to enter the sector.
Recently, Cboe Global Markets’ Bitcoin ETF application decision was delayed until late September of this year. Weeks earlier, the U.S. Securities and Exchange Commission (SEC) denied Winklevoss-owned Gemini exchange’s Bitcoin ETF application for the second time.
Unlike exchange-traded funds, ETNs are investment products backed by their issuers, such as a bank, rather than a pool of assets. Grayscale Investments offers a similar Bitcoin ETN product, called the Bitcoin Investment Trust; however, it trades at a significantly higher premium to the underlying asset, giving Bitcoin Tracker One a clear advantage.
Commenting on their recent Bitcoin ETN launch, Radloff noted:
“I do see this as a competitive product. Our products historically have not traded at a premium and are liquid.”
Bitcoin Tracker One has fallen 51 percent this year due to a persisting multi-month downtrend in the overall cryptocurrency market, according to Bloomberg.
Cover Photo by Marten Bjork on Unsplash