WisdomTree has announced the launch of its first cryptocurrency product, a physically-backed Bitcoin ETP. The WisdomTree Bitcoin ETP (BTCW) listed on SIX, the Swiss Stock Exchange, today with a total expense ratio of 0.95%.
The WisdomTree Bitcoin ETP provides investors with a simple, secure and cost-efficient way to gain exposure to Bitcoin while utilising the best of traditional financial infrastructure and product structuring. As such, the ETP allows investors to access Bitcoin without the need to hold the cryptocurrency directly, store private access keys or interact with the blockchain or digital currency infrastructure in any way. Investors also get access to institutional grade storage solutions without needing to set it up with a custodian themselves.
Alexis Marinof, head of Europe, WisdomTree, said: "We have been monitoring cryptocurrencies for some time and are excited to bring investors secure access to this developing asset class. We have seen enough to believe that digital assets, like Bitcoin, are not a passing trend and can play a role in portfolios. WisdomTree has a history of bringing innovative investment themes to a broad market through institutional-class products, allowing investors to take exposures in difficult-to-access asset classes - we see many parallels between the cryptocurrency space and commodities in this regard. The introduction of cryptocurrencies in an ETP structure will enable investors to find new ways to introduce digital assets into portfolios while still relying on the safety and security that they have come to expect from WisdomTree."
The ETP will be traded on a regulated stock exchange and shares in the ETP will settle via traditional settlement systems. The listing of WisdomTree Bitcoin on the SIX Swiss Exchange will enable investors to benefit from a global access point to trade shares in the ETP and offer liquidity like any other exchange listed security. Bringing cryptocurrencies into the ETP structure could also bring a centralisation of liquidity to the asset class and benefit the underlying digital asset.
Similar to physical gold ETPs, investors in the WisdomTree Bitcoin ETP will have an entitlement to an amount of Bitcoin. Investors will be able to view each share's coin entitlement and the total amount of Bitcoins secured in custody, corresponding to the total coin entitlement, on WisdomTree's website. To ensure the highest level of security, WisdomTree employ institutional-grade digital currency custodians who maintain highly secure cold storage facilities. These specialised custodians employ elaborate physical and digital security procedures and cutting-edge technology to safely generate keys, encrypt data and create and verify digital signatures required for transacting in and safekeeping of cryptocurrencies. WisdomTree's approach addresses one of the key barriers currently limiting cryptocurrency adoption by investors.