ETP Breaks the Barrier
The SIX Swiss Exchange is planning to list the first multi-crypto-based exchange-traded product (ETP) in the world. Supported by Amun AG, a Swiss startup, the first global multi-crypto ETP will be a part of the HODL index. It tracks five major virtual currencies including Bitcoin Cash (BCH), Bitcoin (BTC), Ripple (XRP), Ethereum (ETH), and Litecoin (LTC).
According to reports, each virtual currency receives a certain value within Amun AG’s ETP. Bitcoin will account for almost half of the assets of ETP. The rest of the ETP assets are assigned accordingly: 25.4% in XRP cryptocurrency, 16.7% in Ethereum. The Litecoin and Bitcoin Cash will acquire 3% and 5.2% of the market respectively. Switzerland is one country that is actively supporting the growth of cryptocurrency. Recently, a Swiss bank, Maerki Baumann decided to join the cryptocurrency world. Further, they were soon followed by a similar announcement by Swiss legacy bank, Hypothekarbank Lenzburg.
ETPs Strict Policies
The Chief executive and co-founder of Amun, Hansy Rashwan states that the upcoming ETP will comply with the strict policies for traditional ETPs. Rashwan further adds that the ETP will serve as a well-regulated trading tool for cryptocurrencies useful for both retail and institutional investors. Van Eck, a German index investment management firm unit will manage this Amun ETP index. Based in the “crypto valley” of Switzerland’s Zug town, Amun AG is a branch of the fintech company from the UK, Amun Technologies. Amun AG first made the announcement to launch a crypto ETP in late September of this year. The official site of Amun stated that SIX Swiss Exchange is the fourth largest European stock exchange having a $1.6 trillion market capitalization.
On the eve of the launch of Amun’s ETP, Thomas Zeeb, the head of securities and exchanges at SIX states that digital exchanges will take the place of conventional exchanges in the coming ten years. Hence, according to Zeeb, it will provide a huge cost benefit to the banks, insurance firms and banks.
ETP is a type of derivative security that trades intraday on a national securities exchange. According to Investopedia, ETPs work on the basis of investment tools including a currency, a commodity, an interest rate, or a share price. It is possible to actively manage ETPs as funds or as exchange-traded funds (ETFs). According to experts in the field, Bitcoin ETFs adoption will provide a bigger platform than the Bitcoin futures contract. Thus, it will provide a bigger base for crypto market growth.
Finally, while making a statement on this development, the Head of Market Strategy at Swissquote, Peter Rosenstreich said, “It is the next evolutionary step in our strategy of opening up the cryptocurrency market to the mainstream investor by creating investment opportunities that reduce volatility while offering the transparency that comes with the listing at the Swiss Exchange. “