Bitcoin ETNs Debut on London Stock Exchange—Here's What It Means for Europe’s Crypto Market

UK approves Bitcoin and Ethereum ETNs, potentially making it a crypto hub but needs wider access to compete with the US.
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Key Insights

  • The UK’s Financial Conduct Authority has just approved Bitcoin and Ethereum ETNs

  • These ETNs are similar to ETFs, have less regulatory scrutiny and their launch is seen as a positive step for wider crypto adoption in the UK

  • Experts like 21 Shares' Alex Pollak believe this could set up the UK as a major European crypto hub.

  • Pollak says that lifting the ongoing retail ban on ETNs and offering more crypto ETPs to a wider range of investors is crucial to compete with the US.

The UK stock exchange market is gearing up for a massive reform, as Bitcoin and Ether exchange-traded notes ( also called ETNs) have just launched on the London Stock Exchange.

Just like we saw with the launch of the spot Bitcoin (and Ethereum) ETFs in the US, the crypto market has taken another step forward in the right direction, when it comes to global crypto adoption.

Here's what it all means, for the UK, and Europe, and how it might affect the use of crypto worldwide.

Understanding ETNs and What They Mean?

To understand why this new development with the London Stock Exchange is such a big deal, we first need to figure out what ETNs are.

ETNs are just like ETFs, in that they are also financial vehicles that allow investors to gain exposure to a certain asset (like Bitcoin or Ethereum)—without having to own them directly.

However, the difference is that with ETNs, issuers merely track the prices of cryptos, without directly holding them for investors.

The main advantage of ETNs is that they have a lot less regulatory scrutiny from agencies like the SEC.

This removes the major issues ETFs face and allows investors to gain exposure to crypto in a more convenient way for all parties.

According to Alex Pollak the UK head of 21Shares in an interview with Yahoo Finance, the listing of Bitcoin and Ethereum ETNs on the London Stock Exchange is one of the biggest moments for crypto overall.

Pollak views this most recent development as one of the right steps the UK is taking towards opening up the crypto market within the country and making the United Kingdom the crypto hub it has always aspired to be.

Moreover, Pollak mentioned that within the next three years, the UK might even become the largest crypto ETF market in Europe.

What It Means for UK Investors?

According to Pollak, this is a major milestone for UK investors, because as the largest issuers of crypto ETPs in the world, 21Shares is ready to make these new Bitcoin and Ethereum Financial instruments readily available to UK investors, both in pounds and in dollars.

The only problem with this is that the London Stock Exchange Market is currently only available to professional investors, in light of the January 2020 retail ban on trading bitcoin and ether ETNs at the moment.

However, Pollak is optimistic that this ban will soon be lifted, allowing everyone—including professional, retail and intermediate—investors to participate.

Pollak further mentioned that the approval from the UK’s Financial Conduct Authority (FCA) is a step in the right direction.

However, there is a dire need for more crypto-related ETPs to be accessible to a wide range of investors, in order to keep up with the U.S.

Disclaimer: Voice of Crypto aims to deliver accurate and up-to-date information, but it will not be responsible for any missing facts or inaccurate information. Cryptocurrencies are highly volatile financial assets, so research and make your own financial decisions. 

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