The French investment company Melanion Capital recently received approval for a Bitcoin share ETF. The financial product complies with the UCITS guidelines of the EU.
The French financial services provider Melanion Capital has achieved a real coup. As the Financial Times reported the Paris-based company is launching an ETF that complies with the EU’s UCITS standard. The approval by French supervisory authorities took place just a few days ago. The basket of shares consists of 30 securities from the blockchain sector, including mining companies such as Argo and Riot Blockchain, but also investment service providers such as Galaxy Digital or Voyager Digital. This means that the financial product correlates up to 90 percent with the Bitcoin rate, according to Melanion Capital. According to matching media reports, the BTC Equities Universe UCITS ETF will be listed on Euronext Paris in the coming weeks. The management fee is 0.75 percent.
While there are already some blockchain and mining ETFs on the market, the real highlight of Melanion Capital’s financial product is approval under UCITS guidelines. This is a kind of gold standard of fund regulation, which is characterized by a particularly high level of investment protection. The EU is a kind of trendsetter, because supervisory authorities in Asia and Latin America are also based on UCITS.
“Bitcoin Stock ETF Approval Has Been a Challenge”
Critics meanwhile complain that the guidelines are not really applicable to crypto assets, which is why approvals under UCITS standards are made more difficult. Most national regulators interpret the rules so that digital assets cannot be held directly in funds unless they are linked to listed securities. That makes it almost impossible to set up a UCITS fund that invests predominantly in Bitcoin. Melanion CEO Jad Comair agrees. Compared to the Financial Times he said:
Most channels of the traditional financial system end with access to Bitcoin. The ETF has been a real challenge because of the sensitivities and politics that currently surround Bitcoin and Bitcoin investing.
Melanion CEO Jad Comair told Financial Times
So far, there are only two other blockchain ETFs in Europe that meet these regulations. On the one hand the BCHN from Elwood with currently almost 996 million US dollars AUM and on the other hand the BLOK from First Trust with 117 million US dollars AUM.
Viridi Funds recently took a slightly different approach. With the “Viridi Cleaner Energy Crypto-Mining & Semiconductor ETF”The investment company recently went public on the NYSE. Here, too, the ETF invested in the mining and blockchain sector. However, due to the ongoing environmental debate in the crypto space, the focus of the financial product is on sustainability. Only climate-friendly mining companies are included in the index.