Key Points
- WisdomTree has received approval from the UK’s Financial Conduct Authority to list two cryptocurrency ETPs on the London Stock Exchange.
- The ETPs, backed by Bitcoin and Ethereum, aim to provide institutional investors with a secure and regulated way to invest in cryptocurrencies.
The European cryptocurrency landscape is witnessing significant changes. WisdomTree, a prominent exchange-traded product (ETP) provider, has secured approval from the UK’s Financial Conduct Authority (FCA) to list two physically backed cryptocurrency ETPs on the London Stock Exchange (LSE).
These ETPs, namely the WisdomTree Physical Bitcoin (BTCW) and WisdomTree Physical Ethereum (ETHW), will provide investors with access to Bitcoin and Ethereum. They are fully backed by the actual assets, offering a regulated and secure investment avenue for institutional investors who have been hesitant about the crypto market due to regulatory uncertainty.
Institutional Adoption of Crypto ETPs
Alexis Marinof, head of Europe at WisdomTree, believes that FCA approval could pave the way for more institutional adoption of the asset class. He points out that regulatory constraints and uncertainties have been a major deterrent for institutional involvement in crypto.
WisdomTree is not new to the European crypto market. It has already made its mark on Deutsche Börse Xetra, the Swiss Stock Exchange SIX, and Euronext exchanges in Paris and Amsterdam. The company’s existing offerings provide European investors with a range of crypto ETPs, including physically-backed Bitcoin, Crypto Market, and Crypto Altcoins.
The rising demand for crypto exposure in Europe has been recognized by other players as well. For instance, ETC Group, another ETP provider, launched a product tracking the Compass Ethereum Total Return Monthly index ETO in February on Deutsche Börse Xetra. They expanded their offerings further with a Bitcoin product in April.
Fee Reduction for WisdomTree’s Bitcoin ETP
In a bid to boost competitiveness, WisdomTree has cut the management expense ratio (MER) for its WisdomTree Physical Bitcoin ETP from 0.95% to 0.35%. This move is aimed at offering the most cost-effective physically-backed Bitcoin ETP in Europe without crypto lending, thereby reducing risks for investors.
The FCA’s approval of WisdomTree’s physically-backed Bitcoin and Ethereum ETPs on the LSE marks a significant moment for the European crypto market. This regulatory approval, coupled with lower fees, sets the stage for increased institutional adoption of cryptocurrencies.
As companies like WisdomTree continue to innovate and expand their offerings, a more mature and accessible crypto ecosystem is expected to develop in Europe. This will attract more investors and support the growth of digital assets.
