After failing to get SEC approval in 2019, the investment management company finally gets a Bitcoin ETP in the market.
After spending much of 2019 lobbying unsuccessfully for its publicly traded fund, or ETF, approved by the US Securities and Exchange Commission, the VanEck investment management fund finally launched a publicly traded product backed by Bitcoin.
However, according to a November 25 tweet from the company’s digital asset strategist, Gabor Gurbacs, the product is an exchange-traded note rather than an ETF, and is not listed on a US stock exchange, but on Germany’s Deutsche Börse Xetra.
Rather than being a mutual fund, an ETN is essentially a debt instrument that tracks a sometimes difficult-to-access market, in this case Bitcoin (BTC).
VanEck Vectors‘ Bitcoin ETN is 100% backed by physical Crypto Wealth and offers investors direct exposure to the Bitcoin market in the trusted format of other listed regulated products. Product Manager Dominik Poiger explained:
„Our Bitcoin ETN is fully guaranteed. This means that the money invested in ETNs is actually used to buy Bitcoin. In this way, each TNC represents a certain amount of Bitcoin.“
The Bitcoin will be deposited and stored in cold storage by the Liechtenstein-based crypto custodian Bank Frick.
VanEck made a major effort to try to persuade the SEC to approve his Bitcoin ETF during the first part of 2019, but to no avail, and the Chicago Board Options Exchange withdrew the proposal in September, a month before the final decision was made.
As Cointelegraph reported, the company recently published research showing that Bitcoin is less volatile than many S&P 500 stocks.