Cryptocurrency tracking instruments traded on established equity exchanges allow institutional and retail investors to gain exposure to digital assets. Now there is a new option to invest in bitcoin cash (BCH) with an exchange traded product in one of the most advanced markets in the world. Under the ticker ABCH, bitcoin cash is the sixth Amun crypto-asset tracker listed on the Swiss stock exchange Six.
Bitcoin Cash Exchange Traded Product
Amun AG, a Swiss fintech company aiming to facilitate access to crypto asset investments, announced on Friday, July 5 that it has listed the first exchange traded product (ETP) tracking the performance of bitcoin cash (BCH). Founded in 1850, Six is Switzerland’s principal stock exchange. It offers traders securities including Swiss government bonds as well as derivatives such as stock options.
The Amun Bitcoin Cash ETP is a fully collateralized product that is denominated in US dollars and has an annual investor fee of 2.5% that includes custody, insurance, and re-balancing fees. This new crypto investment instrument is seeded by Roger Ver with 25,000 BCH, worth more than $10 million as of today.
The flow of institutional money into digital assets of all kinds over the past few years has helped the new market mature, granting it similar status to investment categories such as stocks and other equities. By giving investors another option to profit from the success of bitcoin cash, this new tool will also support cryptocurrency becoming mainstream as more people are exposed to it financially.
Headquartered in Zurich, Amun was established in 2018 and is led by a team of serial entrepreneurs and experienced professionals from the asset management industry. It employs an institutional grade security and custody solution using a variety of safety measures including cold storage, multiple private keys, whitelisting and audit trails to hold the underlying crypto assets.
“As Bitcoin Cash is becoming a game changer in the crypto space and beyond, I believe Amun has the credential to carry out our objective, a global adoption of Bitcoin Cash. We are confident that our investment in the new Amun BCH ETP will set the example and drive more investors to join the growing community which believes in the success of Bitcoin Cash,” explained Bitcoin.com CEO Roger Ver.
Six Swiss Exchange Leads With Crypto ETPs
This launch of the BCH exchange traded product follows the listing in the past nine months of five ETPs by Amun for trading on Six. These cover the top 10 cryptocurrencies with the Amun Bitwise Select 10 Large Cap Crypto Index ETP (KEYS), the top five cryptocurrencies with the Amun Crypto Basket Index ETP (HODL), as well as three individual asset trackers on bitcoin (ABTC), ethereum (AETH) and ripple (AXRP).
Hany Rashwan, Amun Co-Founder and CEO, commented: “We are delivering our strategy, which is to provide investors with the wider product suite in the crypto-assets space, easily available on one of the most reputable market place, the Swiss Exchange. Thanks to this product, investors can now easily add Bitcoin Cash (BCH) to their portfolio.”
Given the occasional confusion between ETPs and ETFs (exchange traded funds), it is important to note that while the two instruments have technical similarities, they are legally two different products, and are listed under different categories on Six Swiss Exchange. When the matter popped up last year the exchange clarified that: ”ETPs are collateralized, noninterest-earning bearer debt securities which replicate an underlying [asset] (generally from the commodities sector), either on a regular or leveraged basis. Like ETFs, they trade in a multi market-making segment, but in legal terms they are not funds.”
Not satisfied with merely serving as a hub for investing in crypto assets tracking products, Six is also looking for additional ways to benefit from the innovation underpinning cryptocurrency. Earlier this year the chairman of the exchange, Romeo Lacher, announced Six’s intention to launch a new market powered by blockchain technology during the second half of 2019. The venue, to be called the SIX Digital Exchange (SDX), is expected to initially run parallel to Six’s legacy exchange platform.
By incorporating distributed ledger technology, transactions on SDX will only require a single step and can be completed in less than a second, whereas the legacy platform requires three processes that can take up to several days to finish. Lacher also stated at the time that the exchange is hoping to conduct a security token offering.
The Swiss Advantage
The launch of this bitcoin cash exchange traded product is the latest example of how Switzerland is well ahead of most other countries in terms of crypto finance. For centuries the country was known around the world for its tradition of banking secrecy, but now the cryptocurrency industry has taken root in the country.
Cryptocurrency foundations, community organizations and entrepreneurs have all helped put the lightly populated Swiss canton of Zug on the business world’s map as ‘Crypto Valley’. This is mainly because the local administration has created one of the most welcoming environments for the industry, in contrast to much more restrictive jurisdictions such as the U.S. where many businesses complain innovation is discouraged by heavy-handed regulations.
The latest example of this trend is of course Facebook establishing the foundation for managing its Libra coin in Switzerland, which American politicians see as a possible threat to the hegemony of the U.S. dollar.
What do you think about a bitcoin cash ETP listing on the Swiss stock exchange? Share your thoughts in the comments section below.
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