Forget the Bitcoin ETF, an ETN Already Allows US Investors to Invest in BTC

The Bitcoin ETF has been one of the biggest stories of 2018 in the crypto space.

A similar product already exists and with it, investors in U.S. markets are able to allocate more funds into the Bitcoin market using normal brokerage accounts.

Investors in the cryptocurrency sector-including BKCM founder Brian Kelly and Fundstrat analyst Tom Lee-have said that the introduction of a Bitcoin ETF in U.S. markets will effectively legitimize the cryptocurrency sector, opening the industry to a group of investors who were previously not able to invest in Bitcoin, possibly due to regulatory conflicts.

It's not entirely true that investors in the traditional finance market cannot invest in Bitcoin and cryptocurrencies as a new asset class.

"Sweden's bitcoin ETN is now bigger and trades more than about 80 percent of U.S. ETFs. It hit $700m in aum today while trading $220m this week."

Last week, the same ETF previously mentioned by Balchunas, opened in U.S. markets under the ticker CXBTF. Ryan Radloff, CEO of Coin Shares, which oversees the operation of the ETN, said that the expansion of the ETN from Sweden to the U.S. is a monumental accomplishment for the Bitcoin sector.

"It is interesting because there are a lot of assets which their value is just based on supply and demand. Most stocks, there is no intrinsic value because you have no true ownership rights and no voting rights. You just have the ability to buy and sell those stocks. Bitcoin is the same thing. Its value is based on supply demand. I have bought some through an ETN based on a Swedish exchange."

In a way, ETN provides similar liquidity and ability to U.S. investors to freely invest in Bitcoin in the stock market.

In the case of Cuban, he had to use an instrument in the Swedish stock market, even if it meant paying a premium from the U.S. market, to invest in Bitcoin in a strictly regulated market.

With the XBT Provider ETN in the U.S. market and the publicly gradable instruments operated by GrayScale Investments, large-scale retail traders will be able to invest in Bitcoin and other major cryptocurrencies without the first Bitcoin ETF approval.