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The London Stock Exchange will begin offering cryptocurrency-traded notes tracking Bitcoin and Ether on May 28. In an announcement on March 25, the bourse said it would accept applications for the crypto ETNs as soon as April 8. The applications will need to be approved by the UK Financial Conduct Authority (FCA). The stock exchange said:
Subject to the approval by the Financial Conduct Authority (the “FCA”) of the base prospectuses, which will be required to list Crypto ETNs on the Main Market and also to the Official List of the FCA, the Exchange is proposing that the first day of admission to trading of those Crypto ETN securities will be Tuesday 28 May 2024.
The ETN rollout comes after the London Stock Exchange, on March 11, 2024, said it will start accepting applications for crypto ETNs in the second quarter. Per its earlier announcement, the ETNs will only be available to institutional investors.
To earn the FCA approval, the crypto ETNs must be physically backed and non-leveraged. The assets must also carry a reliable value of the underlying market price. ETN issuers can file up to three different currency lines for the products.
Move aimed at making the UK a crypto hub amid competition
The latest move comes when the UK seeks to establish itself as a haven for crypto and blockchain innovation. The government has, in the past, reiterated plans to make the country a crypto hub, although regulators have preferred a cautious approach via the regulatory route.
UK’s move also comes less than three months after the US approved its first spot Bitcoin ETFs that have since attracted significant inflows from institutional investors. This saw the FCA announce, in March, that it would not turn down requests to create ETN markets by Recognized Investment Exchanges (RIEs).
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