UK Greenlights First Crypto ETP. Does It Signal A New Era For Professional Investors?
The UK’s Financial Conduct Authority (FCA) has greenlit the launch of the country’s first crypto Exchange Traded Products (ETPs) on 22 May 2024, setting the stage for a significant shift in how professional investors can engage with digital assets.
Scheduled to list on the London Stock Exchange (LSE) on 28 May 2024, these ETPs represent a new frontier for the UK’s investment community, albeit with a cautious approach tailored exclusively for professional investors.
According to the Financial Times, the approval of ETPs by WisdomTree and 21 Shares marks a pivotal moment nearly a decade after similar financial instruments first appeared in Sweden.
This development has been heralded by both WisdomTree and 21Shares.
Commenting on the approval of crypto ETPs, Alexis Marinof, head of Europe at WisdomTree said, “The FCA approval of our crypto ETPs’ prospectus is a significant step forward for the industry and UK-based professional investors seeking exposure to the asset class.”
Professional Investors v/s Retail Investors
According to industry observers, the launch of these ETPs is not just a milestone for the UK’s crypto market but also a reflection of the evolving global financial landscape.
However, the UK is also getting criticised for “only allowing ‘professional investors’ and banning retail investors from accessing Bitcoin ETPs.”
🚨 JUST IN: #Bitcoin ETPs are available to retail investors in Australia, Brazil, Canada, Hong Kong and the USA…
The UK only allows “professional investors” and bans retail investors from accessing Bitcoin ETPs.
The Game Is Being Exposed Here… #Bitcoin & #Crypto Is For… pic.twitter.com/9oYzSQByKy
— Good Morning Crypto (@AbsGMCrypto) May 22, 2024
Speaking in favour of the nod to the crypto ETPs, Marinof said, “While UK-based professional investors have been able to allocate to crypto ETPs via overseas exchanges, they will soon have a more convenient access point. FCA approval in this respect could result in greater institutional adoption of the asset class, as many professional investors have been unable to gain exposure to bitcoin and other cryptocurrencies due to regulatory limitations and uncertainty.”
Meanwhile, Ophelia Snyder, co-founder of 21 Shares, said “London hosts one of the deepest, most liquid capital markets in the world where there is proven institutional interest in cryptocurrencies.”
Despite the FCA’s cautious stance in general on crypto, the approval of these ETPs is a significant step forward for the UK’s crypto market. The introduction of crypto ETPs in the UK is expected to catalyse a wave of similar products listing on the LSE, offering professional investors a regulated and structured way to gain exposure to cryptocurrencies.
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Disclaimer: Crypto is a high-risk asset class. This article is provided for informational purposes and does not constitute investment advice. You could lose all of your capital.
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