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With cryptocurrency markets shrinking over 50% this year, 21Shares is working to replicate S&P Dow Jones Indices\u2019 benchmarks with its new risk-adjusted crypto investment products.<\/p>\n
The Swiss crypto investment firm 21Shares has launched two new exchange-traded products (ETP) offering investors exposure to the largest cryptocurrencies \u2014 Bitcoin (BTC<\/a>) and Ether (ETH<\/a>) \u2014 while aiming to soften volatility via rebalancing assets to the United States dollar.<\/p>\n The new products, the 21Shares S&P Risk Controlled Bitcoin Index ETP and 21Shares S&P Risk Controlled Ethereum Index ETP, will start trading on the Swiss SIX Exchange on July 20. The ETPs will trade under tickers SPBTC and SPETH, the firm announced on Wednesday.<\/p>\n Both ETPs target a volatility level of 40%, which is achieved through dynamically rebalancing or allocating more assets to USD when volatility rises. The products seek to replicate S&P indexes\u2019 benchmarks that control risk by adjusting the exposure to the underlying index and dynamically allocating to U.S. dollars.<\/p>\n 21Shares\u2019 director of ETP, Arthur Krause, emphasized that the 40% target refers to volatility rather than investment performance. In a statement to Cointelegraph, Krause noted that large-cap equities in the United States demonstrated annual historical volatility of 20%. For Bitcoin, this figure stood at 70%, while Ether\u2019s volatility amounted to 80%, he said, adding:<\/p>\n \u201cThe 21Shares S&P Risk Controlled Index ETPs combine exposure to a volatile cryptocurrency with cash \u2014 which has zero volatility \u2014 to attempt to achieve the overall target of moderate volatility.\u201d<\/p><\/blockquote>\n Sharon Liebowitz, senior director of innovation at S&P Dow Jones Indices, mentioned that the firm has been actively involved in crypto in recent years. Last year, S&P launched a cryptocurrency index<\/a> tracking crypto market performance. SPBTC and SPETH are examples of indexes aiming to address volatility associated with underlying cryptocurrencies, Liebowitz noted.<\/p>\n The new ETPs join the 21Shares\u2019 bear market-focused offering known as Crypto Winter Suite. 21Shares launched the investment offering in June, aiming to provide investment products specifically designed for low-cost exposure to crypto<\/a> amid the market sell-off.<\/p>\n Just like the other crypto ETPs by 21Shares, the Crypto Winter Suite targets both retail and institutional investors in countries like France, Germany, Switzerland, Austria, Sweden, Netherlands and Australia.<\/p>\n Related: <\/em><\/strong>SEC extends window to decide on ARK 21Shares spot Bitcoin ETF to August<\/em><\/strong><\/a><\/p>\n Despite the ongoing bear market<\/a>, 21Shares has seen an influx in inflows on its platform, recently hitting $100 billion in new assets under management (AUM) year-to-date. \u201cWhile our AUM is down now due to the market conditions, our inflows are at an all-time high,\u201d Krause said, adding that 21Shares currently has $1 billion in AUM. He added:<\/p>\n \u201cInvestors are holding strong and still creating inflows for the long game. Investors who believe in crypto are \u2018buying-the-dip\u2019 \u2014 and particularly via ETPs as a transparent, convenient and safe way to enter the asset class.\u201d<\/p><\/blockquote>\n According to Grayscale Investments, the current bear market could last another 250 days from July 2022 if the duration of previous cycles repeats itself<\/a>.<\/p>\n<\/div>\n