There are already financial products linked to that very volatile currency, but no ETF index fund (acronym for an exchange-traded fund) had been validated as complying with European Ucits regulations, Melanion Capital told AFP. This regulation guarantees certain protections to individuals who invest in the fund.
The ETF fund will not be directly linked to bitcoin, but will seek to replicate the performance of a basket of companies involved in bitcoin, which are listed in North America and Europe.
“This is the first time that an investment vehicle that allows exposure to an asset that is very volatile, but which nevertheless meets all investor protection criteria, has been validated,” said Louis-Arnaud Nguyen, consultant to the AFP specializing in Azzana’s ‘blockchain’ technology.
In practice, investors will continue to be subject to changes in the value of bitcoin, freed from certain risks linked to direct ownership of cryptocurrency, such as piracy or loss.
In return, they will have to pay a management fee.
“It’s a very good instrument for actors who don’t know everything about digital currencies and bitcoin, but who want to expose themselves” to the investment, summed up Louis-Arnaud Nguyen.
Melanion’s ETF will be traded “at the start” on the pan-European stock exchange Euronext, which manages namely the Paris exchange.
This new index fund will be supported by an index created by Melanion, the ‘Melanion Bitcoin Exposure Index’, reviewed every quarter, “on the third Friday of March, June, September and December, after the market closes”, indicated the company, in a statement.
Bitcoin, like other digital currencies, saw its value rise sharply in 2020 and early 2021.
This success has attracted banks, brokers and investment companies looking to make currency accessible to their clients.
Today, at 17.30 in Lisbon, the value of bitcoin was above 44 thousand dollars. Its highest level was reached in mid-April, when it surpassed 64,000 dollars.