Bitcoin ETPs: ETC Group Launches New Exchange-Traded Product (ETP) on Deutsche Börse XETRA

ETC Group is announcing the launch of its latest Exchange-Traded Product (ETP) on Deutsche Börse XETRA.

The ETC Group Core Bitcoin ETP (ticker BTC1; ISIN DE000A4AER62) has “been tailored specifically for benchmark-conscious, long-term buy-and-hold investors, and global institutional investors with extended liquidity and risk management needs.”

BTC1 complements the existing product “range of ETC Group, which includes, among other, the most liquid and largest crypto ETP in Europe.”

Key Highlights of BTC1:

  • Cost-efficient: With a Total Expense Ratio (TER) of 0.30%, BTC1 offers a competitive edge in cost-efficiency.
  • Benchmark-Focused: BTC1 tracks the institutional-grade Bitcoin price benchmark by CF Benchmarks, ensuring accuracy and reliability in tracking Bitcoin’s price movements.
  • Broader and Wider Primary Market Liquidity: As the first regulated global spot Bitcoin product, BTC1 provides unparalleled primary market liquidity, bridging US, European, and Asian spot BTC liquidity during the trading windows used by global, regulated institutional capital.
  • Tri-NAV Methodology: BTC1 introduces a unique Tri-NAV methodology, offering institutional investors an extended primary market liquidity window covering U.S., European, and Asian BTC spot liquidity. Therefore, in addition to stock exchange trading hours, the issuer provides three price determinations throughout the day (instead of just one) to expand primary market liquidity across additional time zones. This means that institutional investors can trade their holdings over the longest period compared to any other regulated Bitcoin spot vehicle worldwide on the primary market. As a result, BTC1 can be considered the first globally oriented Bitcoin spot ETP.
  • Robust ETP Structure: BTC1 uses the same trusted product structure as ETC Group’s other products, including German domicile with primary listing on XETRA, 100% physical backing, and full fungibility with the underlying. Furthermore, BTC1 also features an independent administrator, a unique ETP structural attribute first introduced by ETC Group in 2020. This administrator entity holds legal veto rights on any asset or securities movements of the ETP issuer, monitors custody balances, and overall adds an extra layer of security to the issuer’s product ecosystem.
  • Secure Custody Solution: Assets are securely kept with Zodia Custody, a leading European institutional-grade provider of cold-storage custody, featuring a bank-grade compliance & governance framework.

Bitcoin‘s liquidity is vast but fragmented “across multiple exchanges, complicating price determination for investors.”

CF Benchmarks has developed what it claims is “the most robust benchmark to capture and aggregate this liquidity, the BRR index and its US and Asian variants – BRRY and BRRAP which have collectively become the most widely adopted benchmark used by regulated institutional capital, including the majority of US spot ETFs and CME Futures. BTC1 leverages all three regional variants of this benchmark, allowing institutional investors to track Bitcoin’s fair price accurately and confidently. Ultimately, allowing access to three liquidity pools / valuation points across 14 hours (compared to valuation point and an 8-hour window for all other ETFs and ETPs globally).”

BTC1 addresses the liquidity challenges institutional investors face “with existing Bitcoin ETPs, which are confined by traditional stock exchange trading hours.”

With Bitcoin trading around the clock and Bitcoin Futures trading 23/5, BTC1 offers institutional investors “a global and regulated spot Bitcoin ETP, with currently the broadest primary market liquidity for Bitcoin ETPs globally.”

This extended liquidity window “enhances price transparency and risk management capabilities for institutional investors.”

Chanchal Samadder, Head of Product at ETC Group, commented,

“BTC1 represents a significant milestone in the evolution of Bitcoin investment products. Designed with benchmark-conscious and long-term investors in mind, BTC1 offers a unique blend of cost-efficiency, accuracy, and extended primary market liquidity, setting a new standard in the Bitcoin ETP market.”

Tim Bevan, CEO commented:

“At ETC Group, we want to drive the crypto investment industry forward and the launch of BTC1 represents a unique proposition. With BTC1, we are bringing the first globally orientated Bitcoin ETP to market, with the extended liquidity and risk management features that our clients need. We are proud to be launching yet another market first and we believe that BTC1 has the potential to uniquely serve institutional investors with best-in-class attributes. BTC1 will be tradable on XETRA and many other platforms and will be added to HANetf’s Pan-European ETP distribution platform.”

Recent additions to ETC Group’s institutional product line-up “include ET32, the unique total return Ethereum staking ETP linked to a transparent staking benchmark, and DA20, the only broad-market Crypto Basket ETP tracking an MSCI digital assets benchmark of the top 20 investable cryptocurrencies.”

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