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Topic: Van Eck Launches a Bitcoin ETN on Xetra (Read 207 times)

helal044

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fillippone

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Quote from: Lucius on December 03, 2020, 10:30:23 AM

When you look at the table then Grayscale is a giant compared to all the other dwarves trying to take their share of the pie - but it is also clear that Grayscale is a US based company and that investors there obviously have money and are much better informed about what Bitcoin is.

As for VanEck, they are just getting started and need to be given time to try to catch up with others - but CoinShares seems to be the absolute ruler of the EU in this business segment. However, it is good that more and more funds are appearing, competition is always a positive thing - and it is not very good from the aspect of security that only one fund has such huge amounts of BTC in its possession.

Competition is just heating up.
Regulators are probably a little bit more easy on Bitcoin ETP and another one has just been launched:

Valour Launches World's First Fee-Free Bitcoin Exchange Traded Product (ETP)

This is the first to have a 0% management fee. So probably, more competition is yet to come, with different issuers battling for a bigger stake on asset class that probably will see the biggest inflows in the coming years. Being there is more important that the outright profit.
Quite a different approach than Grayscale, that is thriving on his US monopoly.

Quote from: Lucius on December 03, 2020, 10:30:23 AM

fillippone, you use VanEkt (EKT) in your last post, so I'm a little confused whether it should be like that or VanEck?

Thanks! Fixed it!

Lucius

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fillippone

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I have Just added Van Eck fund on my Bitcoin Treasuries Spreadsheet.

For Sure VanEck hadn't massive rocket start

It has 133 BTC as AUM.
Given the massive numbers other ETP are registering, and the quality of the issuer, I would have expected a little bit more interest. But we saw these things might not happen just right off the bat.

Basically it is not existent when compared with other funds:

fillippone

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Quote from: FullNode on November 25, 2020, 10:21:36 AM

<...>

A small article to see what are the basic differences between an ETF and an ETN

You are correct.
This distinction is actually very theoretical as the NOTE is backed by real Bitcoins and the issuer is an SPV (Special Purpose Vehicle) holding nothing but the asset of the ETF on one side and the ETF as liabilities on the other side of the balance sheet.

From the prospectus:

Quote

VanEck ETP AG (“VEEA”), (LEI 529900R2B8HNG8H5ED30) is a society limited by shares
(Aktiengesellschaft) established in Liechtenstein and subject to the laws of the Principality of Liechtenstein. The
registered office of the company is Landstrasse 36, 9495 Triesen, Liechtenstein. The company has been registered in
the Liechtenstein Public Register on 16 July 2020 with register number FL-0002.640.173-8.
The Issuer has been established as a special purpose vehicle for the sole purpose of issuing collateralized exchange
traded securities. The majority shareholder of the Issuer is VanEck (Europe) GmbH, which in turn is held by Van Eck
Associates Corporation. The members of the Board of Directors are Mr. Torsten Hunke, Mr. Gijsbert Koning, Mr.
Alexander Baker and Mr. Arno Sprenger. The company’s auditor is AAC Revision & Treuhand AG.

https://www.vaneck.com/uk/en/literature/etn-documents/vaneck-vectors-bitcoin-etn-final-terms.pdf/

Lucius

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VanEck is a well-known name from the time when BTC ETFs were a major topic in the crypto world, and if I'm not mistaken they were the only ones to have a request to the SEC for a physical backed ETF (VanEck SolidX Bitcoin Trust). What I noticed in the tweet is that they only mention Europe and Asia, what about the US as one of perhaps the most important markets for crypto right now?

I visited the official VanEck website and found an interesting video with Jan van Eck - although Bitcoin is not mentioned, it is interesting to hear his opinion about stocks, gold and the total market in 2021.

FullNode

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Quote

Exchange Traded Fund – ETF
In practice, the two are very similar. Both are designed to track an underlying asset, both often have lower expense ratios than actively managed mutual funds, and both trade on the major exchanges just like stock.

The main difference is under the hood. When you invest in an ETF, you are investing in a fund that holds the asset it tracks. That asset may be stocks, bonds, gold or other commodities, or futures contracts.

Exchange Traded Note – ETN
An ETN is more like a bond. It's an unsecured debt note issued by an institution. Just like with a bond, an ETN can be held to maturity or bought or sold at will, and if the underwriter (usually a bank) were to go bankrupt, the investor would risk a total default.

For that reason, before investing in an ETN, research into the credit rating of the underwriter is an important metric. If the underwriter were to receive a credit downgrade, shares of the ETN would likely experience a downturn unrelated to the underlying product it's tracking.

https://www.investopedia.com/financial-edge/0213/etf-or-etn-whats-the-difference.aspx

A small article to see what are the basic differences between an ETF and an ETN

avikz

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What excites me in this entire news is just one line that says - fully collateralize exchange traded note that invests in Bitcoin! That's where the significance lies!

We remember when we had a news in the market about CME derivatives and the community cheered about it! But in fact, CME derivatives never invested in bitcoin. It was just price linked trading instrument.

However, this one will invest in bitcoin which will increase the demand and liquidity in the market big time! Happy days are here again, it seems!

fillippone

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Another ETN is joining BTCE on Germany's Xetra:


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