European digital asset manager CoinShares has launched a directly backed litecoin exchange-traded product in Switzerland.
Listed on SIX Swiss Exchange, the CoinShares Physical Litecoin (LITE SW) is available for institutional investors to trade in US dollars, euros, or Swiss francs.
Litecoin, currently the world’s eighth-largest crypto asset by market cap, originated in October 2011 as an early spinoff from bitcoin. It is similar to bitcoin in that it has a fixed supply (programmed to be four times the eventual supply of bitcoin) and undergoes regular block reward ‘halvings’.
The main difference between the two cryptocurrencies is that litecoin delivers a faster block generation time of two and a half minutes (compared to ten minutes for bitcoin). This feature has established litecoin as the go-to cryptocurrency for users seeking to conduct transactions quickly.
Each unit of LITE is “physically” backed with 0.20 litecoins at launch, providing investors with direct exposure to the cryptocurrency with the added oversight, security, and liquidity of an ETP.
The ETP’s bitcoin holdings are custodied by Komainu, a hybrid institutional-grade digital asset custodian designed specifically for financial service providers and blue-chip corporates.
Komainu is a joint venture between global investment bank Nomura, digital asset security specialist Ledger, and CoinShares.
The ETP comes with a management fee of 1.50%.
LITE is CoinShares’ third directly backed crypto ETP and follows from products that are 100% backed by actual bitcoin or ethereum holdings. The CoinShares Physical Bitcoin ETP (BITC SW) has $370 million in assets and comes with a management fee of 0.98%, while the CoinShares Physical Ethereum (ETHE SW) houses $90m and costs 1.25%.
Frank Spiteri, Chief Revenue Officer at CoinShares, said: “As demand for digital assets amongst the traditional investment community steadily increases, we are starting to see the green shoots of demand for investment exposures outside of the top two dominant networks. CoinShares is the leader in creating novel ways for investors to access the digital asset ecosystem, and LITE is the next step on a path to bringing a more comprehensive and diversified offering of ETPs to market.”
Townsend Lansing, Head of Product at CoinShares, added: “LITE comes hot on the heels of our Bitcoin and Ethereum product launches in 2021 and will benefit from the same robust and transparent physically backed product structure. We are excited to add exposure to such a well-accepted and widely traded crypto-asset to our new product line.”
CoinShares also offers eight single-asset crypto products providing exposure to bitcoin, ethereum, litecoin, and ripple in either Swedish krona or euro trading lines. The suite is delivered through the firm’s XBT Provider platform, with products listed on Nasdaq Stockholm and the Nordic Growth Market. These products use synthetic replication through tracking certificates to gain exposure to cryptocurrency markets.