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Overview of 21Shares:
Despite crypto markets tanking this year, Swiss people crypto ETP firm 21Shares has seen its new crypto inflows hitting new all-time highs YTD.
With cryptocurrency markets shrinking over 50% this year, 21Shares are working to copy S&P stock index Indices’ benchmarks with its new risk-adjusted crypto investment products.
New products of 21Shares:
The Swiss crypto fund 21Shares has launched two new exchange traded products (ETP) offering investors exposure to the most important cryptocurrencies — Bitcoin (BTC) and Ether (ETH) — while progressing to soften volatility via rebalancing assets to the U.S. dollar (USD).
The new products, the 21Shares S&P Risk Controlled Bitcoin Index ETP and 21Shares S&P Risk Controlled Ethereum Index ETP, will start trading on land SIX Exchange on July 20. The ETPs will trade under tickers SPBTC and SPETH, the firm announced on Wednesday.
Both ETPs target a volatility level of 40%, which is achieved through dynamically rebalancing, or allocating more assets to USD when volatility rises. The products seek to copy S&P indices’ benchmarks that control risk by adjusting the exposure to the underlying index and dynamically allocating to U.S. dollars.
Vision of 21Shares:
21Shares‘ Director of ETP Product Arthur Krause emphasized that the 40% target refers to volatility instead of investment performance. in an exceedingly statement to Cointelegraph, Krause noted that large-cap equities within the u. s. demonstrated annual historical volatility of 20%. For Bitcoin, this figure stood at 70%, while Ether’s volatility amounted to 80%, he said, adding:
“The 21Shares S&P Risk Controlled Index ETPs combine exposure to a volatile cryptocurrency with cash — which has zero volatility — to aim to realize the target of moderate volatility.”
Sharon Liebowitz, senior director of innovation at S&P Dow-Jones Industrial Average Indices, mentioned that the firm has been actively involved in crypto in recent years. Last year, S&P launched a cryptocurrency index tracking crypto market performance. SPBTC and SPETH are samples of indices attending to address volatility related to underlying cryptocurrencies, Liebowitz noted.
The new ETPs join the 21Shares’ bear market-focused offering called Crypto Winter Suite. 21Shares launched the investment offering in June, planning to provide investment products specifically designed for low-cost exposure to crypto amid the market sell-off.
Just like other crypto ETPs by 21Shares, the Crypto Winter Suite targets both retail and institutional investors in countries like France, Germany, Switzerland, Austria, Sweden, Netherlands and Australia.
Summary:
Despite the continuing market, 21Shares has seen an influx in inflows on its platform, recently hitting $100 billion in new assets under management (AUM) year-to-date. “While our AUM is down now because of the market conditions, our inflows are at an all-time high,” Krause said, adding that 21Shares currently has $1 billion in AUM. He added:
“Investors are holding strong and still creating inflows for the long game. Investors who believe crypto are ‘buying-the-dip” — and particularly via ETPs as a transparent, convenient and safe thanks to enter the asset class.”
According to Grayscale Investments, this securities industry could last another 250 days from July 2022 if the duration of previous cycles repeats itself.
