CoinShares is loading digital asset products into the more common public fund-raising framework in Europe. The company disclosed that the introduction of the Bitcoin mining ETF was not just a new product, but a way to enter the UCITS market and pave the way for the subsequent release of more regulated funds.
UCITS opens the facility entrance.
UCITS is one of the most widely used frameworks for cross-border fund sales in Europe. For a number of institutional investors, such funds are more easily integrated into the established allocation system. CoinShares states that many agencies in the past did not allow investment of debt securities, which also limited their allocation of exchange products supported by physical digital assets.
According to the company, the market ' s interest in digital assets is increasing, but many institutions are unable to buy the products directly due to internal rules. By contrast, UCITS structures are more in line with the compliance requirements of traditional management and wealth management systems and are therefore expected to lower the access threshold.
Follow-up fund will continue to be developed
CoinShares co-founder and CEO Jean-Marie Mognetti stated that the significance of the platform is not just that of an additional fund, but that it allows companies to develop and distribute regulated investment products on a continuous basis under a globally recognized regulatory framework.
CoinShares also indicated that the cost basis of the platform was largely fixed. With more funds on the line, the platform is expected to generate a higher leverage for operations. According to the company, the follow-up product will not only cover digital assets but may also extend to thematic investment strategies.
Institutional configuration is still subject to internal controls
A study previously published by Coin Shares shows that traditional wealth management agencies continue to face internal compliance barriers when integrating client digital assets into portfolio management. Sixty-one per cent of respondents to the survey either restricted their digital assets or had no formal policy in place.
Another study also showed that agency participation in digital assets has not been consistent in recent quarters. At one point, hedge funds and voucher dealers significantly reduced their exposure, but the bank increased its bitcoin ETF holdover during the same period, reflecting the different responses of different institutions to market fluctuations.
Additional information:The UCITS, fully known as the Portfolio Investment Scheme for Negotiable Securities, is the main regulatory framework for cross-border sales of European funds and is usually seen by institutional funds as a more standardized distribution vehicle.