The Financial Conduct Authority (FCA), the leading financial regulator in the UK, has given its approval for physically backed bitcoin and ethereum exchange-traded products (ETPs) to be listed on the London Stock Exchange. This marks the first time that such products will be available on the exchange, and is expected to encourage greater institutional adoption of cryptocurrencies.
Wisdomtree and 21shares are among the first companies to receive approval from the FCA to list their crypto ETPs on the London Stock Exchange. Wisdomtree’s 100% physically backed bitcoin and ethereum ETPs, called Wisdomtree Physical Bitcoin and WisdomTree Physical Ethereum, will be listed on the exchange on Tuesday, May 28th. Initially, these ETPs will only be accessible to professional investors.
The fees for Wisdomtree’s bitcoin and ethereum ETPs will be 0.35%, which is in line with similar products listed on other European exchanges. Alexis Marinof, Head of Europe at Wisdomtree, believes that the FCA’s approval is a significant development for the crypto industry, as it could lead to increased adoption by institutional investors. All of the crypto funds listed in the UK will be structured as exchange-traded notes (ETNs), a common structure in the European cryptocurrency market.
21shares, another company approved by the FCA, will also cross-list its existing bitcoin and ethereum staking ETPs in the UK. These products will have fees of 1.49%. Ophelia Snyder, co-founder of 21shares, highlighted the deep and liquid capital markets in London, as well as the institutional interest in cryptocurrencies, as reasons for listing their ETPs on the London Stock Exchange.
Wisdomtree stated that the FCA’s approval of their crypto ETPs’ prospectus is a significant step forward for the industry and for UK-based professional investors seeking exposure to cryptocurrencies. The approval is expected to remove barriers to entry for professional investors who have been unable to access bitcoin and other cryptocurrencies due to regulatory limitations and uncertainty.
The FCA’s decision to approve physically backed bitcoin and ether ETPs for listing on the London Stock Exchange has received mixed reactions. What are your thoughts on this development? Let us know in the comments section below.
