The Swiss issuer of crypto Exchange Traded Products (ETPs) 21Shares is launching the world’s first Stellar XLM ETP (AXLM) and Cardano ADA ETP (AADA) on the regulated market of the Swiss stock exchange (SIX Exchange).
During the last rebalancing review, Stellar was admitted by the Index Provider (MVIS - HODL5) to the 21Shares HODL basket ETP as fourth constituent after Bitcoin Cash (BCH) and XRP were removed. According to the ETP issuer, now was a good time to add additional single asset ETPs for Stellar and Cardano to the current range of single crypto ETPs.
Cardano (ADA) and Stellar (XLM)
Cardano (ADA) is a blockchain-based smart contract platform enabling developers to build decentralized applications. Unlike other leading smart contract platforms like Ethereum, Cardano currently uses a Proof of Stake algorithm called Ouroboros to power its transaction settlement and to produce new blocks in its blockchain. Cardano was first shipped in 2017 by Input-Output (IOHK), a for-profit company, founded in 2015 by Ethereum co-founder Charles Hoskinson who serves as the CEO.
Stellar is a purpose-built blockchain enabling the transfer of any kind of assets and currencies; for example Bitcoin, dollars and euros, and allowing developers to build low-cost financial services on the platform. Lumen (XLM), Stellar’s native token, is a utility token for the platform to pay transaction fees. Stellar was founded in 2014 by Jeb McCaleb, co-founder of Ripple, and since then the network has processed more than 450 million operations made by over 4 million users.
Increasing demand for cryptocurrencies
The launches are responding to the recent surges of interest in these assets. More broadly, 21Shares has seen a 3-fold increase in demand across its suite of crypto ETPs since Q1 2021 based on aggregated new inflows across the range. Demand has been driven by institutional investors choosing their institutional-grade and open-ended ETPs.
“Following active lobbying with the authorities to extend the innovative and forward-thinking asset launches, we are on track to deliver these new innovative and market leading crypto ETPs. As the leading crypto ETP issuer, Swiss and European institutional alike are asking us for simple and effective access to these new blockchain technologies. These new ETPs deliver what they asked for and we expect to add another 2 new crypto ETPs this quarter on top of new listing venues.” - Hany Rashwan, CEO 21Shares AG
The ETP structure is 100% physically collateralised, segregated and replicates 1:1 the tracking of both crypto assets. Coinbase will assume custody for XLM and Kingdom Trust for ADA. Physical replication for AXLM and AADA aims to track the performance of stellar (XLM) and Cardano (ADA) with each unit of the ETP backed by approx. 40 XLM and 16 ADA respectively at launch. Both products have a base fee of 2.5% p.a and will also be available on the Stuttgart and Dusseldorf MTFs.
