21Shares Unveils S&P Ether and Bitcoin ETPJuly 20, 2022
21Shares, a crypto Exchange Traded Product (ETP) firm in Switzerland, has its crypto inflow skyrocketing. This is in spite of the bad time experienced in the crypto market this year.
The Continuous Crypto Market Woes
The crypto market has, by and large, shrunk by more than 50% this year. 21Shares is working on replicating the S&P indices with its new crypto investment product.
The firm unveiled two new ETPs that offer investors access to the market’s biggest cryptocurrencies. Investors will have access to trade Bitcoin and Ethereum while the firm aims to reduce volatility. It also plans to rebalance access to the US Dollar.
The new S&P risk-controlled Bitcoin and Ethereum Index ETPs will begin trading on the Swiss exchange. The set date for the listing is the 20th of July, 2022. The products are set to trade with the tickers SPETH and SPBTC, 21Share announced.
The two ETPs are targeting the 40% volatility level which can be got via dynamic rebalancing. Or better still, by allocating assets to the US Dollar when there is a rise in volatility. The products’ goals are to replicate what obtains in the S&P indices which control risks.
The means of risk control is via exposure to the index. Next, it will allocate assets to the US Dollar.
The firm’s Director of ETP Products, Arthur Krause, echoed the 40% target being a reference to volatility. It is not about investment performance, as many might have thought. Krause said in a statement that the US large-capitalization equities show annual volatility of 20%.
Bitcoin’s volatility figure is at 70% while that of Ethereum is 80%. Krause said further that the ETPs add exposure to volatile crypto with money. It is an attempt to reach the general target of average volatility.
Crypto Involvement Has Been Up for a While
S&P’s Senior Director of Innovation said the company has been deeply involved with crypto recently. In 2021, S&P unveiled a crypto index that tracks performance in the crypto market. SPETH and SPBTC are recent examples of indicators planning to tackle volatility linked with cryptocurrencies.
The new ETPs are now part of the bear market solutions of 21Shares. The solutions were tagged Crypto Winter Suite at launch. The firm unveiled the investment solution last month as investment products for low-cost crypto exposure.
The Crypto Winter Suite is for both institutional and retail investors in European countries, especially. It follows the idea of other 21Shares ETPs.
In spite of the bear market, 21Shares still records huge inflows. It recently struck $100 billion in assets under management.