21Shares Liquidates Two Bitcoin and Ether Futures ETFs as Crypto Winter Persists
21Shares, a prominent issuer of cryptocurrency exchange-traded products (ETPs), has announced the liquidation of two of its futures-based ETFs: the 21Shares S&P Risk Controlled Bitcoin Index ETP (SPBTC) and the 21Shares S&P Risk Controlled Ethereum Index ETP (SPETH). This move comes amidst a sustained downturn in the cryptocurrency market, highlighting the ongoing challenges faced by crypto-related investment products.
The two ETFs, both listed on the SIX Swiss Exchange, tracked indices designed to mitigate risk by adjusting exposure to Bitcoin and Ether futures based on market volatility. SPBTC and SPETH aimed to offer investors a more conservative approach to gaining exposure to the leading cryptocurrencies. However, the prolonged bear market and decreased investor interest have seemingly led to insufficient demand to justify maintaining these specific products.
21Shares emphasized that the decision was driven by commercial considerations and does not reflect a lack of confidence in the long-term potential of Bitcoin and Ether. The firm continues to manage a diverse suite of other crypto ETPs, including physically-backed Bitcoin and Ether ETPs, which remain unaffected by this liquidation.
What does this mean for investors?
For investors holding SPBTC and SPETH, the liquidation process involves the mandatory redemption of their shares. They will receive the net asset value of their holdings in cash. 21Shares has provided detailed instructions on its website regarding the redemption process and timelines.
The broader context:
This move by 21Shares underscores the current state of the cryptocurrency market. The ongoing "crypto winter" has seen significant price declines across the board, leading to decreased investor appetite for riskier assets, including crypto futures products. While spot Bitcoin and Ether ETFs remain a highly anticipated development in several markets, including the United States, regulatory hurdles and market conditions continue to present challenges.
The future of crypto ETPs:
Despite the liquidation of these specific ETFs, the broader ETP landscape continues to evolve. 21Shares, along with other issuers, remains committed to providing investors with access to crypto assets through various product structures. The focus may shift further towards physically-backed ETPs or other innovative products that cater to the evolving needs of investors in a dynamic market.
Key Takeaways:
- 21Shares is liquidating its SPBTC and SPETH, two futures-based Bitcoin and Ether ETPs.
- The decision is driven by commercial reasons amidst a challenging market environment.
- Investors in the affected ETFs will receive the net asset value of their holdings in cash.
- The liquidation highlights the ongoing impact of the crypto winter on investment products.
- 21Shares remains committed to offering other crypto ETPs, potentially focusing on different product structures.
This development warrants close attention as it provides insight into the evolving dynamics of the cryptocurrency investment landscape. It reinforces the importance of understanding the risks associated with different crypto product types and staying informed about market developments. For further details, investors should refer to the official announcements and resources provided by 21Shares.
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