LONDON (Reuters) – U.S. asset supervisor WisdomTree launched on Tuesday its first funding product that tracks bitcoin, a uncommon instance of a mainstream cash supervisor providing publicity to the unstable world of digital currencies.
FILE PHOTO: Folks stroll previous a board with the brand of Bitcoin in a road in Yerevan, Armenia September 9, 2019. REUTERS/Anton Vaganov/File Photograph
WisdomTree, which focuses on exchange-traded funds, mentioned in an announcement the bitcoin change product (ETP) will supply massive buyers publicity to bitcoin with out the necessity to instantly maintain the asset.
The ETP is the first of its type by a mainstream, established asset supervisor, mentioned Jason Guthrie, WisdomTree Europe’s head of capital markets. WisdomTree oversees belongings price over $60 billion.
Cryptocurrency markets stay opaque and largely unregulated, affected by frequent hacks and heists, with huge cash managers from pension funds tending to steer clear in consequence.
Digital currencies, together with bitcoin, can be utilized to maneuver cash around the globe shortly and with relative anonymity with out the necessity for a government corresponding to a financial institution or a authorities. Till now, although, bitcoin has seen little sensible use, and is as an alternative principally used as a speculative asset.
The ETP, which can commerce on Switzerland’s most important inventory change, will supply extra liquid and clear bitcoin buying and selling, WisdomTree mentioned. Its format will circumvent the necessity for buyers to retailer the non-public entry keys wanted to securely maintain cryptocurrencies, it added.
The product’s underlying bitcoin will probably be held in “chilly,” or offline, storage by Swissquote financial institution, Guthrie mentioned.
It’s unclear whether or not WisdomTree’s transfer will tempt main buyers to dabble in cryptocurrencies.
Different massive monetary companies already supply crypto services and products, together with futures from the New York Inventory Change proprietor the Intercontinental Change Inc and CME Group Inc.
WisdomTree’s Guthrie mentioned the product can be well-liked with long-term buyers who might discover futures troublesome to commerce and handle.
“There’s a demand for issues in an exchange-traded format,” he instructed Reuters. “There are many purchasers that both can’t commerce futures, or discover a physically-backed change traded product to be operationally extra environment friendly.”
Reporting by Tom Wilson; Modifying by Emelia Sithole-Matarise