The French regulator approved Melanion Capital's request to issue a Bitcoin-linked ETF in the European market.
This was reported by the Financial Times, which also reveals that now the french asset manager is ready to launch this ETF on the market that complies with the standards of the EU UCITS (Collective Investment Companies in Transferable Securities), which will try to closely monitor the price. of bitcoin.
This is probably the first ETF regulated by UCITS which is closely tied to digital assets.
The ETF will be called Melanion BTC Equities Universe Ucits ETF and will be listed on Euronext in Paris.
Melanion Capital itself is based in Paris and is a derivatives-based fund manager that is expanding into the digital asset market.
The Bitcoin ETF Coming to Europe
However, the guarantee of the ETF shares put on the market will not be Bitcoin (BTC), but a basket of up to 30 shares in sectors such as cryptocurrency mining and blockchain technology. According to Melanion, the price trend of this basket would be correlated by up to 90% with the price of BTC.
This has likely allowed the regulator to be less fiscal with respect to the potential risks arising from launching a fund pegged to the price of bitcoin, thus overcoming skepticism and difficulties that instead continue to persist in applications to issue directly collateralized ETFs. in BTC.
The fund will follow a specific Melanion index calculated by German fintech Bita, including stocks such as those of mining companies Argo Blockchain and Riot Blockchain, investment management company Galaxy Digital, and broker Voyager Digital, weighted based on how many They are sensitive to movements in the price of bitcoin.
UCITS funds are traded across the EU and are also popular in Asia and Latin America, because “they are considered an international gold standard for fund regulation,” according to FT reports, thanks to the rules set out for the first time. 30 years ago. These rules stipulate that digital assets cannot be held directly by the fund, unless they are tied to listed securities.
The CEO of Melanion, Jad Comair, He said:
“Most of the flows of the traditional financial system stop against bitcoin. The ETF has been a real challenge due to the sensitivity and politics that currently surround bitcoin and bitcoin investments. "