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(Kitco News) –
The European Union has jumped ahead of the United States with the launch of the first spot Bitcoin ETF.
Jacobi Asset Management, a London-based multi-asset investment platform, announced that they have listed Europe’s first spot Bitcoin ETF on Euronext Amsterdam.
The ETF trades under the ticker BCOIN and is regulated by the Guernsey Financial Services Commission (GFSC). Custodial services for the ETF are provided by Fidelity Digital Assets, with Flow Traders operating as market makers and Jane Street and DRW as Authorized Participants.
“It is exciting to see Europe moving ahead of the US in opening up Bitcoin investing for institutional investors who want safe, secure access to the benefits of digital assets using familiar and regulated structures like our ETF,” said Martin Bednall, CEO of Jacobi Asset Management. “Unlike other products in the European market, which are debt instruments, our fund owns the underlying asset directly.”
The Jacobi Bitcoin ETF was approved by the GFSC to launch its Bitcoin ETF in October 2021. Jacobi had originally planned to launch its ETF on the Euronext Amsterdam exchange in July 2022 but was forced to delay those plans due to the collapse of the Terra/Luna ecosystem in May of that year, followed by the bankruptcy of FTX in November.
Before the listing, all of the digital asset exchange-traded products (ETPs) in Europe were structured as exchange-traded notes (ETNs) rather than funds, so the Jacobi Bitcoin ETF is the first fund product launched in the European market.
With ETFs, each shareholder owns a portion of a fund’s underlying shares, while investors in ETNs own a debt security, not the underlying assets. The Jacobi Bitcoin ETF is a centrally cleared crypto-backed financial instrument with custody supported by Fidelity Digital Assets, which is a departure from the usual ETNs.
Not everyone agrees about the significance of the move, however. Bloomberg market analyst James Seyffart said the innovation of BCOIN was being exaggerated.
“There are plenty of spot #bitcoin ETPs in Europe already,” Seyffart tweeted. “This is slightly misleading and really just a regulatory arbitrage type of technicality to call it the ‘first European spot bitcoin ETF.”
Seyffart said that most European ETNs are already physically backed. “This ETF isn’t UCITs & Guernsey is a non-EU country,” he wrote, adding that while it’s “technically correct” to say BCOIN is the first spot Bitcoin ETF in Europe, it’s “largely marketing.”
The market response to BCOIN has also been muted, with trading volumes sparse and the ETF closing at $19.85 on its second day of trading, down from its $20 price at launch.
Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.
