The crypto community will finally welcome the first Exchange Traded Product (ETP) to be listed on a traditional stock exchange early next week, and it is happening in Switzerland.
The landmark derivative was designed by a crypto startup, Amun AG, and will start trading on Six Swiss Exchange, Europe’s Fourth largest Stock Exchange with a market cap of over $1.6 trillion.
Speaking in a report about the new product which was recently approved by Swiss regulators, Amun CEO, Hany Rashwan expressed confidence that the new ETF will open the door to mainstream crypto involvement.
He said that the product would be a good fit for institutional investors who shy away from crypto because of its volatile nature and lack of regulation. Also, retail investors who up to this point have not traded cryptocurrencies because of “local regulatory impediments.”
Inside the Crypto Exchange Traded Fund offered by Amun
The new offering by the startup is scheduled to trade under the ticker “HODL” and will track the largest cryptocurrencies by a market cap which include Bitcoin (BTC), Ethereum (ETH), Ripple XRP, BCH (ABC), and Litecoin (LTC).
The ETF is designed to automatically allocate client investments into the best performing cryptocurrencies in other to guarantee profitability over the period that they buy in.
At the time of writing this report, the fund consists of nearly 50% of Bitcoin and 30% of XRP, which is arguably the best performing crypto this year. There are smaller chunks of 20%+ split among the other altcoins.
CEO Hang Rashwan believes that starting with an index basket that allows traders get exposed to various cryptos is the right way to start and also hope that more trackers will be added for each crypto in the future.
Not in the United States
While some members of the industry have kept a close eye on when the U.S SEC will approve a Bitcoin ETF, it is unsurprising that such a derivative product has been rolled out in a country with regulatory clarity around cryptos.
As mentioned in the report, Switzerland was chosen as the right destination for Amun’s index fund after the startup considered over “23 countries.”
There is even a little chance that the U.S was in that number because of the regulatory uncertainty which the SEC has created around the new asset class.
So while we continue to look forward to the time when a crypto ETF goes live on a U.S stock exchange, we’ll take some time to savor the latest victory in Switzerland.