Two weeks ago XBT Provider AB announced the authorization of Bitcoin Tracker One, the first Bitcoin-based security available on a regulated exchange. Today, Bitcoin Tracker One started trading on Nasdaq Stockholm.
“NASDAQ OMX Stockholm decides to officially list 1 Exchange Traded Note issued by XBT Provider AB with effect from 2015-05-18,” announced XBT Provider AB on Friday. “We are proud to offer the world’s first “Bitcoin tracker” to be traded on a regulated exchange,” states the XBT Provider website. “By enabling this easy and secure way to invest in Bitcoin we hope to have eliminated the boundaries that earlier prevented individuals and companies from being able to actively invest in what we believe to be the future of money.”
“The world’s first Bitcoin-based security on a regulated exchange has been launched in Sweden,” notes the Swedish edition of the English language news site The Local. “The digital currency began trading on the Stockholm market on Monday.”
Bitcoin Tracker One is an “Exchange Traded Note” (ETN) designed to provide investors with convenient access to the returns of the underlying asset, U.S. dollar (USD) per bitcoin, less investor fees. The average dollar exchange rate of bitcoin from the exchanges Bitfinex, Bitstamp and OKCoin provides the underlying reference price. A detailed breakdown of the value of Bitcoin Tracker One is given here.
“Young guys will probably buy it. Bitcoin stands for a new digital world, free from the banking system. It’s almost somewhat political,” savings analyst Claes Hemberg of the Avanza bank told Swedish news wire TT.
The ETN could become an attractive investment option for those traditional investors who want to speculate on the dollar exchange rate of bitcoin with traditional investment vehicles, rather than going through the hassle of buying and holding bitcoin directly. In particular, traditional financial instruments such as Bitcoin Tracker One offer easy ways to short bitcoin and profit from price drops. However, all investments are risky, and this is no exception.
“You shouldn’t put more money towards bitcoin than you would bet on a horse race. You can win, but also lose everything,” Hemberg warned.
Other similar bitcoin investment vehicles are Barry Silbert’s Bitcoin Investment Trust (BIT), now trading on the OTC Markets Group’s OTCQX exchange with the symbol GBTC, and the upcoming Winklevoss Bitcoin Trust ETF (Exchange Traded Fund), which will be available to investors on NASDAQ with the ticker COIN.
XBT Provider AB (publ) is a public limited liability company formed in Sweden and incorporated under Swedish law, with statutory seat in Stockholm. The XBT Provider website states that the company is backed and guaranteed by bitcoin mining hardware manufacturer and service provider KnCGroup. The Local notes that KnCGroup, which had racked up $75 million in turnover in around eight months after its launch in June 2013, opened a new data hub in northern Sweden last year, just a stone’s throw from Facebook’s European data center.