XETRA: ETC Group to list first Litecoin ETP

ETC Group, the specialist provider of innovative, digital asset-backed securities, has announced that it will list LTCetc – ETC Group Physical Litecoin ETC (Ticker: ELTC) on Deutsche Börse’s XETRA platform on Wednesday 14thApril2021. The exchange traded cryptocurrency is structured as an asset-backed debt security issued in Germany, and is marketed and distributed by HANetf.

ETC Group´s Physical Litecoin ETC (Ticker: LITE) will track the price of Litecoin providing investors with an institutional grade product gain exposure to the Litecoin cryptocurrency. ELTC is the first Litecoin product to be listed on Xetra and will be central counterparty cleared1.

The launch follows the huge success of ETC Group’s first product – BTCetc Bitcoin Exchange Traded Crypto (ticker BTCE) – launched on XETRA last June, which has seen its assets under management grow to over $1 billion in just seven months2. BTCE had a turnover of 925million EUR on Xetra in February with a market share of 79.4% of the ETN segment of Xetra and was the most traded ETP across the whole of Xetra3.

It’s the third crypto ETC from ETP Group – earlier this month it listed ETC Group Physical Ethereum ETC (Ticker: ZETH) which tracks the price of Ether and was the first Ethereum ETP to be listed on the Deutsche Borse. ZETH traded over $1million in its first week of launch4 and had spreads of just 23 basis points.

This growing range of crypto ETCs provides investors with several benefits over investing directly in the cryptocurrencies they track. Traded on regulated markets, investors can buy and sell the ETCs in the same way they would when trading conventional shares, with the identical regulatory protections in place. ELTC will be central counterparty cleared (CCP). The first time Lite Coin will be central counterparty cleared globally. Central counterparty clearing, is absent in underlying crypto currency markets, but is a feature that investors expect when trading an ETP on a regulated exchange, as it greatly reduces counterparty risk when trading. ELTC has a management fee of 2%.
Bradley Duke, CEO of ETC Group said: “Litecoin has grown by 342%6 in the past 12 months and is the nineth largest cryptocurrency by market capitalisation at $14.6 billion7 with growing interest from institutional and retail investors. It’s often talked about as the silver to Bitcoin’s gold.

“The current economic uncertainty has underlined the attraction of crypto assets for investors as they offer opportunities for diversification from traditional assets such as equities and bonds, and strong hedging qualities against inflation. But it is a crowded market with more than 8,700 cryptocurrencies8, making it difficult for investors to select assets and to store and manage them.

“Our physically backed Bitcoin ETC (BTCE) was designed to provide investors with a safer and more transparent way to gain exposure to Bitcoin and we are now able to offer the same benefits to Litecoin with the listing of ETC Group Physical Litecoin ETC in addition to the ETC Group Physical Ethereum ETC ,which launched earlier this month.

Institutional investors are demanding regulated crypto products that are secure, liquid and central counterparty cleared and ETC Group is building products that adhere to the complex and exacting standards of the institutional investor.“

“Traditional markets will remain volatile for some time, fuelling demand for alternatives such as cryptocurrencies. In contrast to previous rallies in cryptocurrencies, the current one is the first to be supported by both retail and institutional investors, making this the ideal time to launch ELTC.”

Past performance is no guarantee of future performance. Cryptocurrencies are highly volatile, and your capital is at risk.

Hector McNeil, co-Founder and co-CEO at HANetf, said

“We are excited to be supporting the ongoing expansion at ETC Group and the launch of their third crypto ETC with the listing of ETC Group Physical Litecoin ETC. ETC Group is firmly established as a market leader in offering investment products focused on crypto assets. The huge success of their first product, BTCE, which reached over $1 billion in assets in just over seven months since listing3 demonstrates the growing demand for products which enable investors to avoid concerns about the technical challenge of buying and storing cryptocurrencies. ETPs are listed on a regulated Exchange and investors buy them through regulated brokerages. This is arguably the most robust way to trade and invest in crypto currencies.”

ELTC – ETC Group Physical Litecoin ETC

Approved by BaFin, the German financial regulator, each unit of ELTC is physically backed by Litecoin stored in regulated, institutional-grade safe custody. This gives the investor a claim on a predefined amount of Litecoin – a structure very similar to physically backed gold exchange traded commodities and allows investors the option for redemption in Litecoin. The ETC structure is based on a transparent and verifiable process to ensure that the provenance of the Litecoin in custody has been strictly vetted. Investors do not need to engage with the technical challenges of purchasing and storing the cryptocurrencies such as setting up a cryptocurrency wallet or trading on unregulated crypto exchanges and there is no need to manage cryptographic keys or engage with blockchain technology at all. Units of ELTC are safely held with an investor’s securities broker or bank, thus removing the risk of losing the investment because of, for instance, lack of knowledge of how cryptographic keys work.

ELTC will be supported by a network of world class Authorised Participants (APs) and Market Makers such as Flow Traders, experienced in cryptocurrency markets as well as the ETP markets. The APs ensure on-exchange liquidity and tight spreads, enabling traders to purchase in all sizes without having to worry about market impact.
Trading will be centralised on XETRA, drawing liquidity from the many fragmented crypto exchanges. ETPs are at their most powerful when they democratise access to difficult-to-access asset classes and can harness global liquidity in a robust, and tried and tested product structure.

BaFin confirmed

On March 2nd, 2020, BaFin, the German Regulator confirmed that they now officially recognise cryptocurrencies as financial instruments, a significant step in the official recognition of the important role that cryptocurrencies have been playing in global markets in recent times.

ETC Group brings together financial services professionals and entrepreneurs, with experience spanning both the worlds of digital assets and regulated markets with the goal to become the bridge between crypto and regulated markets, thus making investing in cryptocurrencies easier, safer and transparent.

ELTC, alongside BTCE and ZETH

ELTC, alongside BTCE and ZETH, will be distributed and marketed via HANetf’s unique white label ETF issuance business. HANetf is a fast growing, young business set up by ETF industry veterans. HANetf, Europe’s first full services ‘white label’ UCITS ETF issuer, recently announced that it had exceeded $2 billion in AUM, and that its assets had increased by over 85% since the beginning of 2021.

Investors can purchase ZETH (Ethereum) and BTCE (Bitcoin) through their regular broker or bank with access to XETRA or SIX, and individuals or institutions wanting to exchange their Ethereum or Bitcoin holdings directly for the product can do so via the network of Authorised Participants of the Issuer.
As with all exchange traded products, an investor’s capital is at risk.