An exchange-traded product (ETP) containing gold and Bitcoin, which is a first in Europe, will be launched as of today. The product, which was launched for a long-term investment and inflation protection, is considered a first in the world by combining two popular investment tools such as Bitcoin and gold.
The physically backed investment product was launched by 21Shares, which offers Swiss-based crypto ETP products, and ByteTree Asset Management, a UK provider of alternative investment products, and is called 21Shares ByteTree BOLD ETP (BOLD).
Making a statement about the new investment product, Charlie Erith, CEO of ByteTree Asset Management, said that gold is generally accepted as a hedge in inflationary environments, while expressing that they see Bitcoin as the digital equivalent of gold, as a relatively new asset class, with the potential to be a basic wealth store. Charlie Erith stated that with the investment product, which is a first in the world, they aim to provide a risk and return diversification in a period of high inflation and geopolitical risks.
BOLD will be gold weight in ETP
The weight will be on the yellow metal in the newly launched ETP product. Gold, which is less volatile in its product portfolio, weighs 81.5 percent, while Bitcoin is expected to make up 18.5 percent of the investment product. As a result of the monthly evaluation, it was stated that the weights of the investment assets of the ETP could be changed.
Considering the historical data, Bitcoin has not yet established itself as an inflation protection tool due to Bitcoin's negative correlation with gold. For this reason, the stock market investment product consisting of gold and Bitcoin, which is launched as a long-term investment tool, is given under weight and it is desired to benefit from the long-term return potential of Bitcoin.
Products traded on regulated exchanges based on Bitcoin are seen as important investment vehicles for the adoption of cryptocurrencies. With these products, which provide indirect investment in cryptocurrencies, especially institutional investors can safely invest in cryptocurrencies in legally protected stock markets, bypassing many investment risks.
In the latest developments regarding exchange-traded investment products, Australia's first Bitcoin and Ethereum spot price-based ETF product was to be released this week, but a decision was made for the product to be delayed one day before the launch.