FAQ

European ETP Overview

ETPs (exchange traded products) are financial instruments that trade on stock exchanges, just like shares. ETPs are passive investment vehicles that provide a transparent and secure way to gain exposure to a benchmark or specific asset class.
ETPs in Europe conventionally include the following three types:

ETFs
- Exchange Traded Funds
Structured as funds
Multi-asset/benchmark exposure (segregated assets)
Commonly governed by the European UCITS framework
Trading on major exchanges
ETC logo
ETCs
Exchange Traded Cryptocurrencies
Issued as debt securities by an SPV (assets secured by trustee)
Collateralized (physically backed)
Open-ended
Trading on major exchanges
ETNs
- Exchange Traded Notes
Issued as (unsecured) debt securities by an institution
Default risk due to reliance on issuer financial viability
Mostly closed-ended
Trading on major exchanges

ETC

Exchange-traded products (ETPs) in Europe are divided into the following three categories: ETFs (Exchange Traded Funds), ETCs (Exchange Traded Commodities), and ETNs (Exchange Traded Notes). They are types of securities that track financial instruments, underlying securities, or an index. Listed on stock exchanges, such products trade similar to stocks meaning their prices can fluctuate from day-to-day and intraday. However, the prices of ETPs are derived from the underlying investments that they track, as they are designed to replicate the return of an underlying asset or benchmark.

ETCs are debt instruments that are collateralized (asset-backed), open-ended (no maturity date) and pay no interest. They trade on stock exchanges, like conventional stocks, but track the price of a commodity or a commodity index. This allows investors to gain exposure to the underlying commodity without directly buying the physical commodity or commodity futures contracts. In this sense, ETCs have a share price that moves up and down as the price of the underlying commodities fluctuate in value - in this case - the value of the underlying cryptocurrencies. Popular ETCs exist on e.g. precious metals (e.g. gold as the underlying commodity), and in case of ETC Group's products, the underlying commodity is cryptocurrency such as bitcoin.

Contrary to ETCs, ETFs must ensure a minimum level of diversification and may not hold any physical commodities as per regulatory guidelines. ETCs on the other side offer the possibility to invest in single commodities such as precious metals with ease. Most of the precious metal ETCs (Gold, Silver, Platinum, Palladium) generally indicate the spot price and are physically secured. This means that e.g. physical gold bars are stored in treasury of a trustee as security in case of physically secured gold-ETC. The issuer risk is thereby eliminated.

Similar to physically backed ETCs on precious metals, ETC Group's cryptocurrency ETCs are 100 % backed by cryptocurrency stored with a regulated specialized custodian. The digital assets stored in custody serve as exclusive collateral to back the units outstanding, and are never used for lending transactions or similar.Security over the digital asset collateral is pledged to investors, and this pledge is enforced by a reputable trustee for the benefit of investors.

In everyday conversation, an exchange-traded commodity (ETC) could refer to a commodity exchange-traded fund (ETF), but an ETC is actually a product name for a specific type of security. In the context of ETC Group, the traditional acronym has been tweaked into "Exchange Traded Crypto". From a structural point of view and collateralization aspect it is essentially the same product type.

Yes, for every unit of BTCetc there is a pre-defined amount of bitcoin stored in regulated custody (1 unit = 0.001 bitcoin at issue date, then this value decays at the rate of 2% per year accrued daily, which represents the management fee). Statements are regularly produced by the independent Administrator verifying that bitcoin in custody is always more than sufficient to cover all units of BTCetc in circulation.

Yes, for every unit of ETC Group's products there is a pre-defined amount of the underlying cryptocurrency stored in regulated custody with BitGo Trust Company, a specialized custodian purpose built for the safekeeping of digital assets. Assets stored in custody serve as exclusive collateral to back the units outstanding, and are never used for lending transactions or similar. Security measures such as deep cold storage and multi-signature encryptioon are in place to keep the assets secure.

Trading ETCs

ETC Group's ETCs can be purchased with fiat currency (e.g. Euro) on regulated stock exchange using your conventional broker or bank. Simply search for the respective ISIN, ticker symbol (e.g. BTCE) or other product code on your platform.
Professional investors can get in touch with the Issuer's Authorised Participants for inquiries on OTC trades and block trading possibilities.

The Issuer has partnered with world-class liquidity providers (LPs) and Authorised Participants (APs) to ensure that ample liquidity is available on exchange (secondary market) and that investors can additionally create or redeem units of ETCs on the primary market as well.

Because ETC Group´s products such as BTCetc can be redeemed for cryptocurrency, the price of the ETCs faithfully track the value of the underlying cryptocurrency they track. Any temporary dislocation to the value of the underlying cryptocurrency will be seen as an arbitrage opportunity by market makers and traded away instantly.

The net asset value (NAV) of an ETC represents the net $ value per underlying cryptocurrency for each unit on a specific date or time. The NAV per unit for ETC Group products is calculated once a day using the Bloomberg CFIX index prices at 4pm EST.

While the NAV is fixed and calculated in daily intervals, the market price per unit of ETC will differ as the price of cryptocurrency fluctuates over the course of the exchange trading day.

Yes, if you are e.g. an institutional investor or professional investor this is possible via the network of Authorised Participants. Size restrictions apply to the amount of bitcoin required. Investors would need to open an account with one of the APs and would need to have undergone KYC/AML on the legal entity investing and on the bitcoin itself.

To purchase ETCs on exchange through your broker, you would need to buy a minimum of 1 unit of the respective ETC which equates in value to a predefined amount of cryptocurrency.

The commission fee for trading on exchange or OTC is the fee charged by your broker or bank. Every ETC is subject to a yearly management fee which is deducted from the ETCs’ Cryptocurrency Entitlement via diminishing entitlement to the underlying cryptocurrency.

ETC Group's securities are listed across exchanges such as Deutsche Börse XETRA or SIX Swiss Exchange, and passported across mulitple European countries. For each ETC there is information on the listing venues available under the menu point trading information.

What are the advantages of investing in ETCs?

Investing in ETCs is as simple as buying shares through your broker or bank. Unlike investing directly in bitcoin or other cryptocurrencies, there is no need to engage with the technical challenges of setting up a cryptocurrency wallet to store cryptocurrency. Your ETC units are safely held with your broker or bank, thus removing the risk of losing your investment due to a lack of knowledge of how cryptographic keys work.

ETC Group’s ETCs are traded on stock exchanges such as XETRA or SIX, some of the largest exchanges in Europe. As such stock exchanges are regulated, this means that investors can trade with confidence knowing that all market participants are strictly vetted and carefully monitored to prevent market abuse. The alternative is to buy bitcoin and co. on cryptocurrency exchanges, many of which are unregulated or do not have such strict security and compliance standards.

Your ETC units can also be redeemed directly for the underlying cryptocurrency. As an additional layer of protection for investors, every transaction must be confirmed by the issuer and a reputable third-party administrator to ensure that no cryptocurrency can be misappropriated due to misconduct or negligence from side of the Issuer.

The Issuer stores the cryptocurrency backing the products with BitGo Trust Company, a secure, regulated custodian purpose built for holding digital assets. Strict KYC and AML standards ensure that the provenance of all cryptocurrency in custody has been vetted. Deposits are insured by Lloyds of London against hacking and white-collar crime up to the value of $100 million. BitGo is a regulated trust and cryptocurrency is stored air-gapped in cold storage in their vaults.

Our ETCs are regulated financial instruments under MiFID II and are regulated in each jurisdiction where they are traded - for example in Germany our ETCs trade on Deutsche Boerse’s XETRA exchange and regulated by BaFin (German Federal Financial Supervisory Authority).

Our ETCs have been engineered with the security of the investor in mind. When e.g. units of BTCetc are created, the equivalence in bitcoin is stored at a secure, regulated and insured custodian. Any transactions related to the creation and redemption processes are verified by an independent Administrator. The Administrator can only be replaced with the approval of the Trustee. The Trustee holds security interest over the assets in custody and in the highly unlikely case of the Issuer default, would step in to make sure bondholder obligations are settled in a timely and orderly fashion.

  • Like equities, an investor’s capital is fully at risk and you may not get back the amount originally invested;
  • Exchange rate fluctuations can also have both a positive and negative effect on returns;
  • Past performance of bitcoin and other cryptocurrencies is no guarantee of future performance;
  • Our products may not be a suitable investment for all investors and each investor should determine the suitability of its investment in light of their own circumstances;
  • For a full list of risks associated with our ETCs please consult the relevant prospectus.

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The value of your investment may go down as well as up and past performance is no indication of future performance. Your capital is at risk.

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Disclaimer: The material and information contained on this website is for informational purposes only and ETC Management Ltd, its affiliates, and subsidiaries are not soliciting any action based upon such material. The material and products do not represent or shall not be inferred as an offer or a recommendation to buy or sell a security, nor shall it be considered or treated as investment advice. Additionally, the material accessible through this website does not constitute a representation that the investments described herein are suitable or appropriate for any person. Performance is unpredictable and past performance is no guarantee of future performance. Consider your own circumstances, and obtain your own advice, before relying on any information.

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United States Persons and legal entities resident in the United States

Securities issued by ETC Issuance GmbH or its affiliates have not been registered under the U.S. Securities Act of 1933, as amended, (the "Securities Act"). The Bonds are being offered outside the United States of America (the "United States" or "U.S.") in accordance with Regulation S under the Securities Act ("Regulation S"), and may not be offered, sold or delivered within the United States except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act.

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Certain documents made available on this website may have been prepared and issued by persons other than ETC Issuance GmbH. This includes any prospectus and additional documents thereto. ETC Issuance GmbH is not responsible in any way for the content of any such document. Except in those cases, the information on the website has been given in good faith and every effort has been made to ensure its accuracy. Nevertheless, ETC Issuance GmbH shall not be responsible for any loss which is a direct or indirect result of reliance placed on any part of the website and it makes no warranty as to the accuracy of any information or content on the website. The terms and conditions of securities applicable to investors will be set out in the relevant prospectus, available on the website and should be read prior to making any investment.

Risk Warnings

You should always bear in mind that:

  • Cryptoassets are a highly volatile asset class. Your capital is at risk. The value of cryptoassets can go down as well as up and you can lose your entire investment.
  • Past performance is not an indication of future performance.
  • Rates of exchange may affect the value of investments.
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Investors should refer to the section entitled “Risk Factors” in the relevant prospectus for further details of these and other risks associated with an investment in the securities offered by the Issuers before investing.

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ETC Issuance GmbH reserves the right to modify or amend these Terms and Conditions at any time without prior warning.

Copyright

Content and design of this website are protected by copyright and other applicable laws. Any copying of the website or of its content requires the prior written consent of ETC Issuance GmbH.

Data Privacy Policy

ETC Issuance GmbH respects the privacy of users. Personal data, which are collected when visiting the website, are processed according to the requirements of the GDPR or equivalent national legislation. For details on data privacy, please see our Privacy Policy.

Hyperlinks

Some of the hyperlinks contained on this website may lead the user to external websites that are not under the control of ETC Issuance GmbH and for the content of which ETC Issuance GmbH is not responsible. When the user clicks on such a link, the user will leave the ETC Issuance GmbH website. ETC Issuance GmbH is not responsible for the content of any websites reached by means of such a link.

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ETC Issuance GmbH may collect data about your computer, including, where available, your IP address, operating system and browser type, for improvements to the website, system administration and other similar purposes. These are statistical data about users' browsing actions and patterns, and they do not identify any individual user of the website. A cookie is a small file of letters and numbers that is put on your computer if you agree to accept it. By agreeing to the cookie notice below you are consenting to the use of cookies as described here. These cookies allow you to be distinguished from other users of the website, which helps ETC Issuance GmbH to provide you with a better experience when you browse the website and also allows the website to be improved from time to time. Please note that you can adjust your browser settings to delete or block cookies, but you may not be able to access parts of this website without them.

Governing Law and Jurisdiction

ETC Issuance GmbH is a subsidiary of ETC Management Ltd, company number 12165332, with registered office at Gridiron, One Pancras Square, London, England, N1C 4AG. These Terms and Conditions and your access to and use of this website and the content are subject to the laws of England and Wales.

The products displayed on this website are not available for subscription or purchase by retail investors in your selected jurisdiction. Please contact your broker or financial adviser for further information.

If you continue to use our website, you are deemed to have read and accepted our Terms and Conditions as set out below:

This website is for information only. It does not provide investment, tax or legal advice or recommendations. According to the applicable laws and regulations in your jurisdiction, some contents on this website or the access to certain contents on this website might be restricted.

Disclaimer: The material and information contained on this website is for informational purposes only and ETC Management Ltd, its affiliates, and subsidiaries are not soliciting any action based upon such material. The material and products do not represent or shall not be inferred as an offer or a recommendation to buy or sell a security, nor shall it be considered or treated as investment advice. Additionally, the material accessible through this website does not constitute a representation that the investments described herein are suitable or appropriate for any person. Performance is unpredictable and past performance is no guarantee of future performance. Consider your own circumstances, and obtain your own advice, before relying on any information.

Distribution of Information:

The distribution of the information and material on this website may be restricted by law in certain countries. None of the information is directed at, or is intended for distribution to, or use by, any person or entity in any jurisdiction (by virtue of nationality, place of residence, domicile or registered office) where publication, distribution or use of such information would be contrary to local law or regulation.

You must inform yourself about, and observe any such restrictions in your jurisdiction and by accessing this website you represent that you have done so. The information on this website is not for distribution and does not constitute an offer to sell or the solicitation of any offer to buy any securities in the United States to or for the benefit of any United States person (being residents of the United States or partnerships or corporations organised under the laws thereof).

By accepting these Terms and Conditions, you hereby confirm that according to the applicable laws and regulations of the relevant jurisdiction (be it the jurisdiction of your nationality, residence, incorporation of the company you are representing or current physical location) you are allowed access this website.

No contract

Use of this website does not result in a contractual relationship between the user and ETC Issuance GmbH. To that extent, no contractual or quasi-contractual claims arise against ETC Issuance GmbH as a consequence of visiting this website.

No offer

No content of this website should be considered as an offer to purchase any product or securities as described on this website. The prices and valuations published on this website are indicative and are for information purposes only, as is other information displayed on this website. Any person making offer of securities described on this website shall observe and strictly comply with restrictions on the usage of information pursuant to these Terms and Conditions, as well as any restriction imposed by a prospectus published with respect of any securities described or applicable laws and regulation, including without limitation restrictions imposed by the EU Prospectus Regulation (REGULATION (EU) 2017/1129 OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 14 June 2017).

Authorised Investors

Any securities described on this website are not permitted to be offered for sale in all countries and are in each case reserved for investors who are authorised to purchase the securities. Selling restrictions applicable to specific products are set out in the relevant prospectus and should be read carefully by investors. Any restrictions imposed by the relevant prospectus are in addition and without prejudice to any restriction or prohibition established by laws or regulations of any jurisdiction.

United States Persons and legal entities resident in the United States

Securities issued by ETC Issuance GmbH or its affiliates have not been registered under the U.S. Securities Act of 1933, as amended, (the "Securities Act"). The Bonds are being offered outside the United States of America (the "United States" or "U.S.") in accordance with Regulation S under the Securities Act ("Regulation S"), and may not be offered, sold or delivered within the United States except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act.

The information provided on this website is not directed to any United States person or legal entity or any state thereof, or any of its territories or possessions.

U.S. PERSONS (AS DEFINED IN REGULATION S) AND LEGAL ENTITIES RESIDENT IN THE UNITED STATES MAY NOT ENTER THIS WEBSITE.

Information from this website may not be distributed or redistributed into the United States or into any jurisdiction where it is not permitted.

Exclusion of liability for content

Some documents displayed on the website and its content are restricted to ”Professional Investors” only and are not intended for retail or private investors. By making use, opening, or downloading such documents, you agree that you are an “Institutional Investor” as defined here: https://www.handbook.fca.org.uk/handbook/COBS/3/5.html, and have read, understood and accepted the conditions.

Certain documents made available on this website may have been prepared and issued by persons other than ETC Issuance GmbH. This includes any prospectus and additional documents thereto. ETC Issuance GmbH is not responsible in any way for the content of any such document. Except in those cases, the information on the website has been given in good faith and every effort has been made to ensure its accuracy. Nevertheless, ETC Issuance GmbH shall not be responsible for any loss which is a direct or indirect result of reliance placed on any part of the website and it makes no warranty as to the accuracy of any information or content on the website. The terms and conditions of securities applicable to investors will be set out in the relevant prospectus, available on the website and should be read prior to making any investment.

Risk Warnings

You should always bear in mind that:

Investors should refer to the section entitled “Risk Factors” in the relevant prospectus for further details of these and other risks associated with an investment in the securities offered by the Issuers before investing.

Changes of terms and conditions of website use

ETC Issuance GmbH reserves the right to modify or amend these Terms and Conditions at any time without prior warning.

Copyright

Content and design of this website are protected by copyright and other applicable laws. Any copying of the website or of its content requires the prior written consent of ETC Issuance GmbH.

Data Privacy Policy

ETC Issuance GmbH respects the privacy of users. Personal data, which are collected when visiting the website, are processed according to the requirements of the GDPR or equivalent national legislation. For details on data privacy, please see our Privacy Policy.

Hyperlinks

Some of the hyperlinks contained on this website may lead the user to external websites that are not under the control of ETC Issuance GmbH and for the content of which ETC Issuance GmbH is not responsible. When the user clicks on such a link, the user will leave the ETC Issuance GmbH website. ETC Issuance GmbH is not responsible for the content of any websites reached by means of such a link.

Cookies

ETC Issuance GmbH may collect data about your computer, including, where available, your IP address, operating system and browser type, for improvements to the website, system administration and other similar purposes. These are statistical data about users' browsing actions and patterns, and they do not identify any individual user of the website. A cookie is a small file of letters and numbers that is put on your computer if you agree to accept it. By agreeing to the cookie notice below you are consenting to the use of cookies as described here. These cookies allow you to be distinguished from other users of the website, which helps ETC Issuance GmbH to provide you with a better experience when you browse the website and also allows the website to be improved from time to time. Please note that you can adjust your browser settings to delete or block cookies, but you may not be able to access parts of this website without them.

Governing Law and Jurisdiction

ETC Issuance GmbH is a subsidiary of ETC Management Ltd, company number 12165332, with registered office at Gridiron, One Pancras Square, London, England, N1C 4AG. These Terms and Conditions and your access to and use of this website and the content are subject to the laws of England and Wales.

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