London To Gain Its Own BTC And ETH ETNs

The new ETNs will make BTC and ETH available to professional investors, but retail traders will be left out.

Will the UK ever realize its plans to become a crypto hub?

The London Stock Exchange will begin trading Bitcoin and Ethereum Exchange-Traded Notes (ETNs) on May 28. According to a document published by LSE, applications for the ETNs will be accepted from April 8.

The timeline is designed to allow multiple providers to apply, provide prospectuses, and work with the UK's financial regulator, the Financial Conduct Authority (FCA), to ensure compliance.

We have decided to launch the market in Crypto ETNs on 28 May 2024 to enable the maximum number of issuers to be present in the market on the first day of trading. In choosing this date we have taken into consideration that we need to ensure that issuers meet the requirements for consideration detailed in the Crypto ETN factsheet and importantly, it will also enable those issuers planning on admitting securities on the launch date, time to prepare documentation to establish a Crypto ETN programme which will require a base prospectus to be approved by the FCA.
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Professional Investors Only

The ETNs are similar in principle to the bitcoin spot ETFs that launched on the US markets earlier this year, though there are differences in the ways that ETNs and ETFs are structured.

However, unlike the US ETFs, the UK ones trading on LSE will only be available to institutions and professional investors. Retail traders will not have access to them.

UK’s Stance On Crypto ETFs Raises Questions
The UK remains cautious on crypto ETFs, unlike the US and Europe, citing regulatory concerns.

This move is at odds with the UK's supposed ambition to become a "crypto hub". UK investors generally do not have access to the US ETFs either, even those provided by huge financial institutions like BlackRock and Fidelity.

The news also comes at a time when the LSE is falling behind other major global exchanges, and London is starting to lose its reputation for being a financial center. There are a number of reasons for this, with Brexit being a major cause. As the UK left the EU, there are greater regulatory barriers to working with its closest and largest trading partner.


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