On Wednesday (15 August 2018), an “F share” (ticker: CXBTF) became available for “Bitcoin Tracker One”, an exchange-traded note (ETN) that tracks Bitcoin (BTC/USD), and is issued by Swedish company “XBT Provider”, a wholly-owned subsidiary of UK company Global Advisors (Holdings) Limited.

This Bitcoin ETN trades on Nasdaq Stockholm (Stockholm Stock Exchange). Although this is a non-U.S. security, being available as a F share (quoted in USD) makes it more accessible to U.S. brokerage/retirement accounts.

According to Bloomberg, which announced this news, Ryan Radloff, the CEO of CoinShares (Holdings) Limited, the company that holds all the shares in the capital of XBT Provider (the issuer of “Bitcoin Tracker One”), explained why this news was significant:

“Everyone that’s investing in dollars can now get exposure to these products, whereas before, they were only available in euros or Swedish krona. Given the current climate on the regulatory front in the U.S., this is a big win for Bitcoin.”

Although some people may see this product as being very similar to Grayscale Bitcoin Investment Trust (ticker: GBTC), which also offers exposure to Bitcoin, the latter has lower liquidity and is more expensive (according to Seeking Alpha, a single share of GBTC trades roughly 50% over the price we would expect from the underlying asset).

Radloff agrees: “I do see this as a competitive product. Our products historically have not traded at a premium and are liquid.”

Thomas Lee, Fundstrat Global Advisor’s Head of Research, took to Twitter to explain why he was excited by this news:

CRYPTO: ⁦@CoinSharesCo⁩ just announced a #BItcoin ETN quoted in USD (ticker: CXBTF). Similar to GBTC, so traditional brokerage account can buy. @coinshares products trade at NAV (we talked about before) so returns virtually identical to #Bitcoin https://t.co/j7NNSuoDgn — Thomas Lee (@fundstrat) August 15, 2018

@CoinSharesCo buys #BTC with each share issuance, which means this ETN functions similarly to an ETF despite differences in structure. See excerpt from their Factsheet… Hence, as shares rise/AUM grows, $CXBTF is buying Bitcoin. pic.twitter.com/pjv7COUDoh — Thomas Lee (@fundstrat) August 15, 2018

According to this ETN’s Fact Sheet, it first started trading on the Nasdaq Stockholm exchange 18 May 2015. Much more detailed information about the product is available via the 2018 Prospectus.

If you look up CXBTF via a U.S. brokerage account or a market data provider such as ADVFN, you will see a quote that looks something like this:

On 17 January 2018, a CNBC article titled “What the US can learn from Sweden about how to launch a bitcoin fund” explained what was special about this ETN:

“An ETN is an unsecured debt instrument that promises to pay the pattern of returns of the bitcoin price. Ironically, despite being an unsecure instrument, the XBT product tracks the spot price of bitcoin by holding the actual currency and forward contracts in case of a liquidity shortfall.”

At that time, Laurent Kssis, who serves as CEO and Head of Product Development for the ETN business at XBT Provider AB, told CNBC:

“At that point in time [18 May 2015], the ETN structure was the best route to bring the products to market. As a result of using this structure to bring the product to market, investors have been able to gain exposure to the price movement of bitcoin since 2015. This stands opposed to the U.S., where most investors are still waiting for access to bitcoin exposure via their normal brokerage account.”

Matt Hougan, the Global Head of Research at Bitwise Asset Management, who used to be the CEO of Inside ETFs, also spoke to CNBC back in January 2018:

“The [XBT] products are very well designed for what they do. They deliver, unlike GBTC. They give exposure to the returns of bitcoin and ether pretty well. I think they were well executed and they've done their job.”

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