Shortly after the cancellation of the Bitcoin Futures (BTC) ETF application in the US, Invesco Asset Manager launched the BTC Spot Exchange Traded Notes (ETN) in Europe.
On November 29, German stock exchange operator Deutsche Boerse officially announced the listing of ETN Invesco Physical Bitcoin on its Xetra digital exchange. The new product will be traded under the symbol BTIC.
The new ETN product is listed on the regulated market of the Frankfurt Stock Exchange, is physically backed by Bitcoin and is centrally liquidated through Eurex Clearing. “Thanks to central clearing, investors benefit from a significant reduction in risk when settling transactions,” the report states.
According to a report by ETF Stream, the storage of bitcoins held on behalf of BTIC will be handled by Standard Chartered’s crypto storage platform known as Zodia. It has been reported that Northern Trust, a co-investor in Zodia, will act as BTIC’s administrator. Zodia, which was launched in late 2020, is registered with the UK’s Financial Conduct Authority.
CoinShares, a senior European digital asset manager, is a recognized partner of Invesco and will act as the index sponsor and executive agent for the new ETN. BTIC tracks the hourly Bitcoin base price index at CoinShares, providing data on the price of the underlying asset minus fees.
This news comes shortly after Invesco withdrew its SEC application for bitcoin futures ETFs in October to provide investors with better investment options, not just 100% futures ETFs.
Gary Buxton, Invesco’s head of ETF and Indexed Strategies, said, adding that Invesco has been working on the product “since mid-2018.”
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Invesco’s entry into the European crypto-exchange product (ETP) industry comes at a time when the German exchange is actively expanding the range of crypto-derivatives backed on its exchanges. According to the company, the Xetra exchange offers up to 26 ETNs from seven different cryptocurrencies, including Bitcoin, Ether (ETH), Bitcoin Cash (BCH), Cardano (ADA), Litecoin (LTC), and others.
ETFs and ETNs are both types of ETPs, and they are quite similar in that they track the underlying assets and trade on exchanges in the same way as other securities. While an ETF involves investing in a fund with assets, an ETN is much like a bond, providing access to unsecured debt for the organization.