WisdomTree, a US-based issuer of exchange-traded products and asset manager, today launched its first investment vehicle linked to cryptocurrencies on SIX Swiss Exchange. The newly-listed product is a physically-backed Bitcoin ETP called ‘WisdomTree Bitcoin ETP (WBTC).’
This ETP gives access to the world’s most popular crypto coins through a fully collateralized product, which is denominated in US dollars and has an annual investor fee of 0.95 percent. The venture was built to overcome barriers that have blocked institutional investment in digital assets and minimize the risk of loss due to theft or operational errors.
WisdomTree, which oversees $60 billion, promotes its product as offering investors the ability to purchase a single-coin ETP that has the benefit of a market maker to ensure liquidity, and that is 100% physically-backed.
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The WBTC is very similar and has the same principal characteristics as a physical gold ETP and therefore appeal to a wide range of investors. This is where ETPs products come in as they offer exposure to the Bitcoin market without having to worry about custody or even own the underlying asset.
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“Similar to physical gold ETPs, investors in the WisdomTree Bitcoin ETP will have an entitlement to an amount of Bitcoin. Investors will be able to view each share’s coin entitlement and the total amount of Bitcoins secured in custody, corresponding to the total coin entitlement, on WisdomTree’s website,” the asset manager said.
The US asset manager opted to list in the Swiss bourse after the SEC repeatedly delayed decisions on similar ETFs products such as proposals from Van Eck and Bitwise. Still, there is such fierce interest in the first mainstream US exchange to list a crypto-backed ETP or ETF as investors who aren’t comfortable with the volatility that crypto affords can gain exposure at a lower risk profile.
Commenting on the launch, Alexis Marinof, Head of Europe at WisdomTree, said: “We have been monitoring cryptocurrencies for some time and are excited to bring investors secure access to this developing asset class. We have seen enough to believe that digital assets, like Bitcoin, are not a passing trend and can play a role in portfolios. we see many parallels between the cryptocurrency space and commodities in this regard. The introduction of cryptocurrencies in an ETP structure will enable investors to find new ways to introduce digital assets into portfolios while still relying on the safety and security that they have come to expect from WisdomTree.”