- Jacobi Asset Management’s Bitcoin ETF, first in Europe, commences trading on Euronext Amsterdam.
- The ETF distinguishes itself as Europe’s premier decarbonized digital asset fund in alignment with European Sustainable Finance Disclosure Regulation (SFDR).
Euronext Welcomes Pioneering Bitcoin ETF
In a monumental stride for the European crypto market, Jacobi Asset Management introduced its trailblazing Bitcoin ETF on Euronext Amsterdam, an achievement that nudges Europe ahead of the U.S. in the ETF race. This launch follows Jacobi’s approval from the Guernsey Financial Services Commission in late 2021. Though initially scheduled for a launch last year, unexpected upheavals, including the Terra ecosystem’s downturn and FTX crypto exchange’s insolvency, led to a prudent postponement.
Currently, the Jacobi FT Wilshire Bitcoin ETF, identified by the ticker BCOIN, imposes a 1.5% annual management fee. Key collaborators include Fidelity Digital Assets, responsible for custodial tasks, Flow Traders as the market maker, and Jane Street and DRW as authorized participants.
Decarbonizing Digital Assets
What truly stands out about Jacobi’s ETF is its distinctive alignment with Article 8 of the SFDR, which positions it as the maiden decarbonized digital asset fund in Europe. By collaborating with digital asset platform Zumo, the fund integrates a Renewable Energy Certificate (REC) system. This built-in solution enables institutional investors to engage with Bitcoin while satisfying their Environmental, Social, and Governance (ESG) mandates.
In clearer terms, RECs, distinct from offsets, strictly pertain to electricity consumption. Each REC symbolizes 1 MWh of electricity. The adoption of RECs by the ETF underpins the dedication to renewable energy and strengthens the commitment to sustainability.
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Differences Between ETFs and ETNs
This momentous Bitcoin ETF underscores a paradigm shift from the prevalent exchange-traded notes (ETNs) in Europe’s crypto sphere. The primary distinction lies in the investment’s essence: ETF investors own a piece of the underlying assets, whereas ETN investors essentially hold a debt instrument.
Martin Bednall, Jacobi’s CEO, emphasized that ETFs, being regulator-endorsed and supervised by regulated entities, offer a heightened level of protection for investors, a feature not inherent to ETNs. Furthermore, ETFs operate without leveraging or integrating derivatives, offering a bulwark against potential market manipulation risks. In stark contrast, ETNs might incorporate these financial instruments, thereby elevating the risk tier.
While Europe celebrates its maiden Bitcoin ETF, the U.S. still anticipates its own. The U.S. SEC has consistently deferred or declined every application it’s reviewed, frequently pointing to concerns like potential market manipulation. Yet, optimism remains high that a U.S.-based Bitcoin ETF will eventually gain the regulatory green light, given the recent wave of applications submitted by industry giants like BlackRock, Fidelity, and Invesco.
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