Europe’s first spot Bitcoin exchange-traded fund (ETF) by Jacobi Asset Management is finally poised to make its debut later this year after a significant delay. Originally scheduled to launch on the Euronext Amsterdam Exchange in July 2022, the listing was postponed due to exceptional market conditions triggered by the collapse of the Terra-Luna ecosystem and FTX collapse in 2021.
Having obtained approval from the Guernsey Financial Services Commission (GFSC) in October 2021, the asset manager has decided to proceed with the launch now, citing a gradual shift in demand compared to the previous summer. However, the exact date is yet to be confirmed.
The Jacobi Bitcoin ETF stands out as it is a centrally cleared crypto-backed financial instrument with custody supported by Fidelity Digital Assets. This represents a departure from the usual structure of exchange-traded notes (ETNs) employed for crypto-backed traditional financial instruments in Europe. Unlike ETNs, where investors own debt securities, ETF shareholders have partial ownership of the fund’s underlying assets. ETFs are not leveraged and do not utilize derivatives, reducing the risks of market manipulation.
While Europe approved its first spot Bitcoin ETF in October, the United States Securities and Exchange Commission (SEC) has thus far rejected all such proposals. However, in 2023, several institutional giants, including BlackRock and Fidelity, have submitted fresh applications for spot Bitcoin ETFs in the hopes of securing the first U.S. approved offering. The SEC has already granted approval for a couple of futures Bitcoin ETFs in 2021.
This development marks a significant milestone in the adoption of cryptocurrencies within regulated financial markets. It provides investors with an opportunity to gain exposure to Bitcoin through a regulated and transparent investment vehicle, potentially paving the way for further institutional participation in the crypto space.
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