The Swiss SIX Exchange is listing a new cryptocurrency ETP called Bitcoin Capital Active ETP. This will trade BTC against as many as 14 top altcoins, including ETH. It will also exit into fiat without the need for investors involved in the transaction. This is the first actively managed crypto ETP to enter the market, and it is now listed on SIX exchange, which is one of the largest stock exchanges in the world. This step is, therefore, considered of vital importance for the finance world. It can prove as a massive step in the direction of acceptance of virtual currency that is considered as the currency of the future.
According to analysts, the coins that are traded against BTC are chosen after carefully analyzing their strengths. Such coins usually have their own blockchain and have high market capitalization. In this way, there will be no problems associated with liquidity in the future. In this way, investors are secured to some extent as the trading is done only on reputed coins. This can set the trend for many such ETPs shortly.
Unlike traditional ETPs that operate in the finance market, the crypto-backed ETPs are always backed by assets. Apart from that, this is actively managed ETP, unlike other options available in the market.
Future of ETP
The concept is still in its early stages, and the response to such actively managed ETP will be known in the near future. However, many people believe that actively managed ETPs are a better option when compared to standard ETP, and this is especially true in the cryptocurrency market. The risk management process is done actively, and the regular passive approach of ETP will not be followed in this option.
The Bitcoin Capital AG will issue the BTCA, which will trade against other crypto coins. This is expected to give better returns to investors. The good thing about the ETP is that it has received regulatory approval from the Switzerland Government and FiCAS will be offering BTCA to investors.
SIX is also well known for other crypto ETPs, and they are used by clients to bet against bitcoin’s price in the market. In the same way, investors can also invest in other ETPs that track the price movement of various other crypto coins like ETH, BCH, and XRP on the SIX exchange. However, this is the first time they are offering actively managed ETP for investors.