Summary
TLDR: The London Stock Exchange is considering proposals for bitcoin and ether exchange traded notes (ETNs) for professional investors only, following guidance from the UK’s Financial Conduct Authority. These ETNs must be physically backed and meet certain criteria to be admitted for trading. Meanwhile, the Securities and Exchange Commission in the US has approved physically backed bitcoin ETFs but has not yet approved spot ether funds.
Key Points
1. The London Stock Exchange is considering proposals for crypto investment products, specifically bitcoin and ether exchange traded notes (ETNs), following new guidance from the UK’s Financial Conduct Authority.
2. These ETNs would be available for professional investors only, such as investment firms and credit institutions authorized to operate in financial markets, and must be physically backed with the underlying crypto assets held in cold storage or verified by third-party audit reports.
3. While the FCA banned the sale of crypto derivatives and ETNs to retail consumers in January 2021, they have since allowed recognized investment exchanges to create a market segment for such products for professional investors.