Jacobi Asset Management has announced that Europe’s first Bitcoin exchange-traded fund (ETF) is set to be listed on Euronext Amsterdam. The launch of the ETF, which has faced delays due to market conditions and regulatory challenges, is now on track for this month, according to a recent report. Originally scheduled for July 2022, the release was postponed following the Terra Luna cryptocurrency crash in May 2022 and the collapse of crypto exchange FTX later that year.
Jacobi Asset Management believes that the demand for Bitcoin ETFs has significantly shifted since last summer, leading them to proceed with the listing. Notably, this ETF stands out from existing digital asset exchange-traded products (ETPs) in Europe as it is structured as an ETF rather than an exchange-traded note (ETN).
Unlike ETPs that are based on debt securities, ETFs offer investors direct ownership of the underlying assets. In the case of this Bitcoin ETF, each shareholder will own a portion of the fund’s underlying BTC shares. Jacobi emphasizes that their ETF does not employ leverage or derivatives, reducing potential counterparty risks.
To facilitate the launch, Jacobi has obtained authorization in Guernsey, a jurisdiction known for its favorable fund servicing conditions. Guernsey’s flexibility and understanding of complex regulatory details have enabled the necessary adaptations for this innovative fund vehicle. The decision to launch the Bitcoin ETF in Guernsey demonstrates the jurisdiction’s support for novel investment opportunities.
Launching a Bitcoin ETF in Europe presents regulatory challenges as BTC is not currently considered an eligible asset under Ucits rules. Michael O’Riordan, a founding partner at Blackwater Search and Advisory, highlights the industry’s failure to clearly differentiate between ETFs and ETPs, leading to confusion among market participants.
Despite these challenges, investors eagerly anticipate the new investment vehicle that offers direct ownership of Bitcoin shares. As Jacobi Asset Management prepares to launch Europe’s first Bitcoin ETF, it marks a significant development in the region’s cryptocurrency investment landscape.