Digital Assets: A Guernsey-Approved Spot Bitcoin ETF From Jacobi To Debut In Europe This Month
The spot bitcoin ETF from Jacobi is moving to take advantage of increasingly favorable crypto market conditions.
Europe’s first bitcoin exchange-traded fund (ETF) is set to be publicly listed after a one-year delay. Jacobi Asset Management had originally planned to launch the ETF on Euronext Amsterdam in July 2022 but postponed it due to market conditions following the Terra Luna cryptocurrency crash and FTX’s collapse.
However, the asset manager now believes that the demand has shifted, prompting the ETF’s launch this month. Unlike existing digital assets exchange-traded products in Europe, which are structured as exchange-traded notes (ETNs), Jacobi’s ETF offers ownership of underlying shares. (FT)
The fund has been authorized in Guernsey, a jurisdiction that provides advantages for launching a bitcoin fund. Guernsey’s flexibility and understanding of complex details allowed the promoter to launch a regulated fund vehicle when other European jurisdictions were unable to do so.
The ETF does not utilize leverage or derivatives, mitigating significant counterparty risk. The distinction between ETFs and ETNs has been a topic of concern, with Jacobi criticizing the misuse of the ETF term by ETN issuers. While the regulatory challenges of launching a bitcoin ETF in Europe are significant, the ETF and exchange-traded products (ETP) share similarities in practice.
European digital assets ETPs have experienced substantial flows, with $483 million entering in the past 18 months.
However, assets in European digital assets ETPs currently stand at €4.3 billion, down from a peak of €10.5 billion at the end of 2021.
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