European ETF issuer VanEck has announced the launch of a bitcoin exchange-traded-note (ETN) on the Deutsche Böerse. The ETN will launch on the electronic trading venue of Europe’s third-largest exchange, Xetra.
According to ETF Stream, the VanEck Vectors Bitcoin ETN (VBTC) will have a total expense ratio (TER) of 2% and is set to be fully replicated. VanEck reportedly partnered with Bank Frick, a crypto custodian regulated in Liechtenstein, to hold the underlying BTC in cold storage.
Bitcoin ETPs have started being launched on Germany’s Xetra exchange after receiving approval from German financial regulator BaFin. Gabor Gurbacs, director of digital asset strategy at VanEck, commented that bringing to market a “physical, fully-backed major exchange-listed bitcoin ETP was a top priority of our firm.”
On social media, Gurbacs pointed out VBTC is physically-backed, has a negligible premium over its net asset value, is transparent regarding its holdings, offers investor protections, and is professionally managed by VanEck.
The Bitcoin ETN Uses MV Index Solutions’ MVIS CryptoCompare Bitocin VWAP Close Index (MVBTCV) as its underlying index to track the price of the flagship cryptocurrency. MVBTCV is a rules-based index that covers the broadest CCCAGG pricing for indices provided by CryptoCompare.
The newly listed bitcoin ETN is easily accessible to investors as purchasing it is “as simple as trading in stocks or ETFs,” and managed a bitcoin wallet and its private keys are not required. The VBTC ETN gives investors exposure to the cryptocurrency, without having them learn about hot and cold storage, for example.
Martijn Rozemuller, Head of Europe at VanEck, said:
Bitcoin’s historically relatively low correlation to other asset classes makes it an excellent way to contribute to the diversification of a portfolio.
ETF Stream details this is the third bitcoin exchange-traded product listed on Xetra, after ETC Group’s BTCE, which recently crossed the $100 million in assets under management mark, and 21Shares’ Bitcoin ETP, ABTC.
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