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WisdomTree and 21Shares list crypto products on the London Stock Exchange
LONDON (Reuters) -WisdomTree and 21Shares will launch cryptocurrency-backed exchange-traded products (ETPs) on the London Stock Exchange, the companies said on Wednesday after getting the green light from Britain’s financial regulator.
The expected listings, set to be a first in the UK, come after Britain’s Financial Conduct Authority (FCA) in March approved the launch of what it called “cETNs” (cryptoasset-backed exchange traded notes) for professional investors .
Investors are increasingly buying cryptocurrencies via ETPs, even as regulators warn of the risks.
The price of Bitcoin surged after the U.S. Securities and Exchange Commission (SEC) approved bitcoin exchange-traded funds in January, and cryptocurrencies have gained in recent days on expectations that the SEC will approve a similar product for the second largest cryptocurrency, ether.
The two WisdomTree products offer investors exposure to the underlying cryptocurrencies: one for bitcoin and one for ether. The listing is scheduled for May 28, asset manager WisdomTree said in a statement, adding that it was “among the first issuers” to have its crypto ETPs approved by the FCA.
“While UK-based professional investors have been able to allocate crypto ETPs via overseas exchanges, they will soon have a more convenient entry point,” said Alexis Marinof, Head of Europe at WisdomTree.
“FCA approval in this regard could lead to greater institutional adoption of the asset class.”
21Shares, which bills itself as the largest global issuer of cryptocurrency-backed ETPs, said it will list on the London Stock Exchange following recent regulatory approval.
“London is home to one of the deepest and most liquid capital markets in the world, where there is proven institutional interest in cryptocurrencies,” it said in a statement.
The FCA said cryptocurrencies are highly risky and largely unregulated.
It bans sales to retail investors, saying the products are “unsuitable for retail consumers due to the harm they pose.”
“Those who invest should be prepared to lose all their money,” the regulator said in March.
(Reporting by Elizabeth Howcroft; Editing by Tommy Reggiori Wilkes, Mark Potter and Jane Merriman)