Bitcoin and Ethereum launch on London stock exchange

Institutional investor interest in cryptocurrency is increasing, with recent notable news that crypto-related products, such as Exchange Traded Notes (ETNs), are now becoming available on the London Stock Exchange.

This development follows the introduction of the first Bitcoin Exchange Traded Funds (ETFs), which is an important step in the increasing acceptance of cryptocurrencies by institutional investors.

ETNs, which are similar to bonds but do not pay interest, are traded on an exchange just like stocks. Unlike ETFs, which typically have physical assets or stocks as collateral, traditional ETNs do not. However, crypto-ETNs are an exception; they must be physically backed by the underlying cryptocurrency, such as Bitcoin or Ether, which must also be stored securely offline (cold storage). These crypto-ETNs may not be leveraged, limiting the risk to the actual value of the crypto-assets held.

Until recently, these crypto-ETNs were only available to institutional investors, indicating a cautious but clear shift toward acceptance of cryptocurrencies within the traditional financial sector. A milestone in this development was the approval of the first Bitcoin ETFs in January 2024, with the notable newcomer being a fund managed by BlackRock, the world's largest asset manager. BlackRock has since purchased significant amounts of Bitcoin, underscoring the growing interest and confidence in cryptocurrencies from institutional investors.