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Post: London Stock Exchange Launching Cryptocurrency ETNs for Professional Investors in May

London Stock Exchange Launching Cryptocurrency ETNs for Professional Investors in May

Key Points:

  • The London Stock Exchange (LSE) will launch cryptocurrency exchange-traded notes (ETNs) tracking Bitcoin (BTC) and Ether (ETH) on May 28.
  • Crypto ETNs will be available only to professional investors due to the U.K. FCA’s ban on the sale of crypto derivatives and ETNs to retail investors.
  • Issuers must meet specific requirements, including physical backing, non-leverage, reliable valuation, and denomination in Bitcoin or Ether.
  • Crypto ETN applications can be submitted starting April 8, with listing pending approval by the FCA and meeting all necessary criteria.

London Stock Exchange to Launch Crypto ETNs in May

The London Stock Exchange will introduce cryptocurrency exchange-traded notes (ETNs) tracking Bitcoin and Ether next month, catering to professional investors only.

Regulatory Restrictions on Crypto ETNs

Due to regulatory restrictions, these crypto ETNs will exclusively target professional investors, aligning with the U.K. FCA’s ban on selling such products to retail investors since January 2021.

Strict Requirements for Approval

Issuers of crypto ETNs must adhere to stringent requirements, including physical backing, non-leverage, reliable valuation tied to the underlying market price, and denomination limited to Bitcoin or Ether.

Application and Listing Details

Interested parties can start submitting crypto ETN applications from April 8, with listing being contingent on FCA approval and meeting all specified criteria, such as cold storage of underlying assets by approved custodians.

Hot Take

The decision to limit crypto ETNs to professional investors reflects ongoing regulatory concerns regarding investor protection and risk management in the crypto market.

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