Switzerland’s main stock exchange has given the green light to the self-described world’s first actively managed crypto exchange-traded product. The Bitcoin Capital Active ETP (BTCA) has secured all regulatory approvals to start trading on the Six exchange in Zurich.
Created by Bitcoin Capital AG and managed by Switzerland-based investment manager FiCAS AG, the cryptocurrency ETP had been constructed to meet the same strict standards required of conventional exchange-traded products. The fund’s portfolio will allow investors to gain exposure to the top 15 cryptocurrencies and anticipates returns through an actively managed approach that shifts holdings between fiat and crypto-assets.
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Different from other crypto financial products, the BTCA is not based solely on a single or underlying basket of indexed crypto assets. Instead, it encompasses a mix of Bitcoin and selected altcoins, as well as fiat currencies, which are actively managed based on market fundamentals, investors’ sentiment, and quantitative trading patterns. FiCAS said it would use relevant risk management tools, proprietary quantitative models, technical analysis, and fundamental research.
Issuers of Bitcoin Capital Active ETP argue that the exchange-traded product wrapper offers a liquid and convenient means to access digital assets as investors can purchase it similarly to buying shares on the secondary market. They can invest in the new fund through any broker or financial adviser at a bank with access to the Swiss Stock Exchange.
“Based on our in-depth trading and analytical experience, actively managing our underlyings allows us to preempt and react to market movements through the discretionary buying and selling of crypto assets to steer risk-adjusted returns. Personally, I have built my expertise in crypto trading since 2013, with a strong track record in outperforming the market. I look forward to bringing my trading experience to global and institutional markets with this pioneering product,” said FiCAS founder Ali Mizani Oskui.
The Swiss bourse already lists different crypto-related ETPs, including from US asset managers. They preferred Switzerland as their original regulators have repeatedly rejected multiple applications to similar products, citing concerns that such vehicles could expose investors to fraudulent practices.
Still, there is such fierce interest in the first mainstream US exchange to list a crypto-backed ETP or ETF as investors who aren’t comfortable with the volatility that crypto affords can gain exposure at a lower risk profile.