Investors in the UK can now trade exchange-traded products (ETPs) that track Bitcoin and Ethereum on the London Stock Exchange, marking a significant step in the country’s alignment with other financial leaders in digital assets.
This development follows the Financial Conduct Authority (FCA) approving the first crypto exchange-traded products from issuers such as WisdomTree and 21Shares last week.
New Crypto ETNs Launched
21Shares announced the launch of four new physically-backed crypto exchange-traded notes (ETNs) on Tuesday, including the 21Shares Bitcoin ETN, 21Shares Ethereum Staking ETN, 21Shares Bitcoin Core ETN, and the 21Shares Ethereum Core ETN.
Competing firm WisdomTree also introduced two physically-backed ETPs: WisdomTree Physical Bitcoin and WisdomTree Physical Ethereum ETFs.
Listings from both issuers, along with Invesco Digital Markets, were featured on the FCA website, showing approvals dated May 28.
FCA Restrictions and Market Impact
Despite holding Bitcoin or Ether directly, these new crypto products are restricted to professional investors only, due to FCA regulations. This contrasts with the US market, where recently approved Bitcoin ETFs manage a combined $59 billion, nearly five times the total crypto vehicle trade volume in Europe.
However, Alex Pollak, head of UK for 21Shares, predicts that the UK will become Europe’s leading crypto ETF market within three years. He believes the key to success lies in allowing everyday investors to trade these products.
Earlier this month, Alun Cairns, a Conservative UK Member of Parliament, urged the FCA to review its ban on crypto ETNs for retail investors. He expressed concerns about the nation’s lagging position and highlighted the potential opportunities being denied to the general public.
US Approval of Spot Ethereum ETFs
In the US, the Securities and Exchange Commission (SEC) recently approved spot Ethereum ETFs, a move that surprised many analysts who did not expect approval as early as May. This decision increases pressure on South Korean regulators to potentially allow similar crypto investments.
