After the successful launch of the first Bitcoin ETF‘s in the United States, it was only a matter of time before other nations looked to follow suit, and it looks as though Spanish bank Santander looks to release a Bitcoin ETF soon.
The appetite for Bitcoin and other cryptocurrencies is growing at an unprecedented rate. Realizing the need to cater to this demand, Spain’s Santander bank is currently in the final stages of launching a Bitcoin ETF, according to reports.
If approved, the investment vehicle would be the first-of-its-kind to be rolled out by a Spanish bank. But it’s not without a number of issues. Even as Santander looks to release a Bitcoin ETF, Spanish regulators have been reluctant to approve one even as ETFs have witnessed stunning success across other countries, including the USA.
While the latest development comes at a time when Bitcoin ETFs’ launch has prompted the underlying asset’s price rally, Santander’s Executive President Ana Botin revealed that the bank has been exploring the product for quite some time now.
“We are a leader in crypto. We issue the first bond on the blockchain…. Now we are about to offer cryptocurrency ETFs.”Ana Botin, Executive President of Santander
Santander looks to release a Bitcoin ETF even as Spain’s Regulatory Climate isn’t yet ready.
Santander hasn’t as yet divulged any other details with regards to the new product, probably because as of yet, no Bitcoin ETFs have been registered with the Spanish National Securities Market Commission (CNMV) to date.
But Spanish interest in cryptocurrency has been increasing recently, with many institutions saying they are either gearing up to roll out initiatives or at the very least researching them to address the rising demand from customer.
Just last week, the Bank of Spain had requested the country’s financial entities to report on their business relationships with cryptocurrency service providers and exposure to digital assets.
In addition, the Spanish financial authority also asked banks about their plans to issue tokens or offer different services such as custody, trading, or payment features for crypto-assets and detail their plans until 2024. The main reason behind the data request is to understand the ramifications that the current “process of digitalization and financial innovation” may have.
Besides, the Spanish opposition party, the Partido Popular (PP), had proposed a bill that would enable payments of mortgages with crypto. The bill in question also sought the creation of a crypto council focussing on the development and impacts of the digital asset and blockchain industry in the country.
However, once again here at SugarWired, we like to point out that banks getting involved in selling cryptocurrency products to customers is simply a way for them to position themselves as middle-men, as buying, holding and trading crypto in Spain is already legal, and anyone can simply open a wallet and begin trading without the need for banks.
That said, investment vehicles such as ETF’s require a certain amount of regulation, and this is where large financial institutions generally place themselves in the market.
Crypto ETF’s outperforming traditional ETF’s
Crypto ETF’s are already outperforming their traditional counterparts, according to investment research company Morningstar, who are reporting that crypto ETFs have dominated the performance of the top 20 European ETF’s recently.
The top 3 places were occupied by Polkadot ETF products, with the number one best performing ETF was the SEBA Polkadot ETC (SDOT), which was launched in July 2021.
Then came 21Shares Polkadot ETP as the second best performing with a 51.64% increase over the month, and third place was taken by VanEck Vectors Polkadot ETN A, with a 51.13% gain.
Bitcoin and Ethereum ETFs took all the remaining 17 top-performing places. It would have helped that Ethereum made an all-time-high at the end of October, by topping $4400. Since then, it has climbed to around $4740 at time of writing.
Bitcoin was helped back into the limelight last month by the SEC granting a licence for the first Bitcoin futures ETF in the US. However, given that this is a futures, and not a spot ETF, the Proshares Futures ETF will just invest in Bitcoin futures contracts rather than buy the underlying asset.
According to the Morningstar report, non-crypto ETF’s don’t even make the performance list until 34th place, which belongs to the First Trust Nasdaq® Clean Edge® Green Energy UCITS ETF (QCLU).