ETP Makes Institutional Investors’ Lives Easier

Switzerland stock exchange, SIX Swiss Exchange, is in the process of listing the first ever exchange-traded product (ETP) tracking cryptocurrencies.  Amun Crypto is the name of the ETP that seeks to track the performance of five major cryptocurrencies. Similarly, the cryptocurrencies included in the ETP are Bitcoin (BTC), XRP, Litecoin (LTC), Bitcoin Cash (BCH), and Ethereum (ETH).

Amun Crypto ETP

Each of the cryptocurrency’s task is to command a certain market share in the Exchange Traded Products. Bitcoin will account for the largest share at almost half.  Similarly, Ripple will count for about 25%, Ethereum at 16.7%, and Bitcoin Cash and Litecoin accounting for about 5.2% and 3% respectively.  The Amun ETP is to trade under the ticker name, HODL.

The announcement comes at a tumultuous time as most cryptocurrencies are trading lower. In fact, Bitcoin has plummeted to its lowest level in one year. Unfazed by the implosion, Amun CEO, Hany Rashwan, says the ETP will trade with the same strict standards as other Exchange Traded Products.

Likewise, the executive expects the ETP to provide institutional investors with a way of gaining exposure in the burgeoning sector.

“The Amun ETP will give institutional investors that are restricted to investing only in securities or do not want to set up custody for digital assets exposure to cryptocurrencies. It will also provide access for retail investors that currently have no access to crypto exchanges due to local regulatory impediments,” said Mr. Rashwan.

The launch of an ETP tracking multiple cryptocurrencies is a major milestone. For the longest time investors have had to contend with ETFs tracking a single cryptocurrency such as Bitcoin. XBT Providers in Switzerland already offers a Bitcoin ETF under the name Coinshares.

Cryptocoins Incite Mixed Reactions

The launch of a cryptocurrency ETP in Europe comes on growing mixed reactions about cryptocurrencies.  A top banker in the European Central Bank has already taken a swipe at cryptocurrencies, consequently terming Bitcoin as “evil spawn.”

Bank of England governor, Mark Carney, is also on record terming cryptocurrencies as risky investments. Likewise, the governor has called for stringent regulation of the sector. Critics also continue to raise concerns that people are using cryptocurrency for shady purposes; money laundering and tax evasion, as well as drug transactions.

Amidst the negative sentiments, IMF chief, Christine Lagarde, has in the recent past weighed on the matter; Lagarde has urged central banks to consider the possibility of developing state-backed cryptocurrencies. According to the IMF chief, cryptocurrencies could help enhance business operation by reducing costs associated with the use of cash.

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