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Two crypto giants team up for a tactical initiative to launch a new cryptocurrency. CoinShares is the largest investment firm in Europe, and FTX is a crypto exchange platform coming together to launch an ETP with physical stakes. The partnership is to launch a Solana offering, while the first project is an exchange-traded product (ETP) that uses the wagering rewards to lower costs for investors.
According to CoinShares announcement, the company launched with SOL 1 million in seed capital. It uses a specific mechanism that allows investors to get 3% in strike rewards and a reduced management fee of 0%. In addition, the product will be listed on Xetra, Germany’s main market and will be CoinShares’ fourth ETP in 2022.
[1/5] We are pleased to announce that we have partnered with @FTX_Official and our first initiative is the launch of a physically deployed Solana ETP with SOL1mn seed capital, Staking Rewards of 3.0% per annum and a reduced management fee of 0.0% per annum pic.twitter.com/dCq5H2CH1c
— CoinShares 👩🚀 (@CoinSharesCo) March 23, 2022
Consequently, CoinShares’ previously physically deployed ETPs are Polkadot, Cardano, and Tezos. Now, this partnership supports the physically backed Solana ETP, while Sam Bankman-Fried, CEO of FTX, has been a long-time mainstay of Solana Labs.
According to Townsend Lansing, CoinShares’ Head of Product, “The company’s in-house strike agent helps avoid liquidity problems by agreeing to borrow coins to cover redemptions as they arise.” Moreover, most CoinShare investors come from the private sector, so the two companies are paving the way for accessing crypto through heavily regulated methods such as ETPs. This concept allows institutional investors to be attracted to the crypto space.
Significantly, the ETP launch follows the launch of FTX Access earlier this month to provide better services to institutional investors. It is a new tool that leverages the experience of FTX and FTX US to offer digital asset products to global institutional clients. In addition, FTX CEO Sam Bankman-Fried stated that:
“FTX Access’ mission is to bring institutional-grade services and solutions to the market at low cost.” In addition, he mentions that CoinShares has consistently provided innovative services to European investors over the past decade. Thus, it reflects the favorable fundamentals that CoinShares has provided in the European sector. What’s more, this announcement came after the official announcement of FTX’s expansion into Europe. The exchange received approval from Cyprus Securities and Exchange in early March. FTX has more updates and implementations in the pipeline for its users.