London Stock Exchange to accept crypto ETN applications for professional investors - DLNews

• The FCA has given the London Stock Exchange the green light to accept applications for crypto exchange-traded notes.
• The ETNs will be limited to professional investors.
• The exchange said it will accept applications to list the products in the second quarter.

The London Stock Exchange announced Monday it will accept applications for Bitcoin and Ethereum exchange-traded notes, in a move that sets the stage for a new market segment in the UK.

The announcement came as the UK’s Financial Conduct Authority said it “will not object” to requests from recognised investment exchanges to list ETNs.

The ETNs will be available only to professional investors.

Unlike the booming spot Bitcoin exchange-traded funds that were approved in the US in January, ETNs are classified as debt securities, but like the ETFs, they provide investors with exposure to an asset. While spot ETFs represent a stake in an underlying commodity, ETNs are issued as senior debt notes and are traded more like bonds than stocks.

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Crypto adoption in the UK has been slow going despite Prime Minister Rishi Sunak’s stated desire to make the UK a “crypto hub.” Sunak said that in April 2022 when he was the Treasury head.

Since then, cryptocurrency firms have faced pushback from regulators, who have approved only a handful of crypto businesses. But now the FCA appears to be more open to crypto investment products.

“Exchanges will need to continue to make sure sufficient controls are in place so trading is orderly and proper protection is afforded to professional investors,” the FCA said in its statement Monday.

The LSE said it will accept applications for the ETNs in the second quarter, but didn’t give a specific launch date.

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Tyler Pearson is a junior markets correspondent at DL News. He is based out of Alberta, Canada. Got a tip? Reach out to him at ty@dlnews.com.

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2024-03-11 18:58:36Z
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