Digital Currency Revolution Series: Bitcoin ETNs Likely To Be Listed On Frankfurt Stock Exchange

As we have seen series of regulatory obstacles to introduce Bitcoin ETFs due to which the massive price plunge was seen in the year 2018 (BTCUSD has tumbled from all-time highs of $19k areas to the current $9k mark), the crypto-aspirants don’t seem to be reluctant ever since then, they keep searching for the alternatives.

While Gold-backed cryptocurrencies have higher costs and risks than ETFs and managed gold funds. Investors can suffer loss of value due to faulty private key storage, double-spends from weak blockchain security, regulatory uncertainty, lack of liquidity, and non-transparent accounting of gold vaults.

Stockholm-based XBT had introduced the ETN like product back in 2015, which has been listed on Nasdaq Stockholm exchange.

For now, another German fintech start-up, ‘Iconic’ is inteding to list crypt-backed products on stock exchanges in Frankfurt and Luxembourg.

As per the German business news agency Handelsblatt’s reports, the company ‘Iconic’ has filed a prospectus to list Bitcoin-backed exchange-traded note (ETN) and aims to list the products on the Frankfurt and Luxembourg exchanges, which would be available as soon as the beginning of December 2019. 

It is reckoned that the lack of exchange-traded notes (ETNs) facility hinders the prospects of Bitcoin (BTC) as an investible asset class. Amid the regulatory apprehensions of the current growth of the Bitcoin derivatives market, the trading activity has considerably improved since the launch of first regulated bitcoin derivatives back in December of 2017.

In addition to that, ‘lack of retail investor accessibility and proper understanding of the derivatives products’ are the considerable issues in this space, to address such burning issues, Many top veterans projected an idea that more ETNs to intensify the impetus of investors’ sentiments among the cryptocurrency gamut.

Handelsblatt reports that Iconic which is Frankfurt-based start-up, and their ETNs would be regulated by Luxembourg’s finance watchdog also, the Luxembourg Financial Supervisory Authority. 

With this mechanism, they invest into pool of funds of Bitcoin from the renowned US-based cryptocurrency exchanges. 

Of-late, the cryptocurrency exchange-traded funds (ETFs) have been branded as the trump card by many aspirants of the crypto-avenue who carry great deal of optimism that exchange-traded funds likely to stimulate cryptocurrencies with more authenticity in retail and institutional investors’ perspectives

However, the entire cryptocurrency industry has seen in a massive struggle ever since the U.S. SEC (Securities and Exchange Commission) kept declining the various attempts of launching a bitcoin ETFs. Now, ETNs could be perceived as the alternative for making an access to the bitcoin ETFs.

Resembling to exchange-traded funds (ETFs), ETNs are also listed and traded on the exchanges. ETNs are unstructured products to perform the functionality of a bond which could be held upto the maturity for redemption.