London Welcomes Cryptocurrency Securities Trading – Forbes Advisor UK

Starting on 28 May, and pending regulatory consent, securities anchored in Bitcoin and Ethereum—the top two giants in the cryptocurrency space—can be exchanged on the London Stock Exchange.

On 11 March, the LSE made public its intention to open the floor to Bitcoin and Ethereum exchange traded notes (ETNs) applications in Q2 of 2024. A fixed date has been announced—8 April 2024—for submission of these applications, enabling the LSE ample time to review the documentation prior to the initiation of trading in May.

ETNs are investment vehicles that mirror the performance of their associated assets, which, in this instance, are the crypto tokens themselves. These are akin to exchange-traded funds (ETFs) and are bought and sold like standard equities.

Bitcoin’s valuation has skyrocketed in 2024, thanks to the impending ‘halving’ event—an event that comes every four years and reduces the issuing of new Bitcoin by half (to understand this further, click here). Earlier in the month, Bitcoin exceeded the £57,000 mark, considerable growth from roughly £35,000 at the year’s start.

Ethereum also witnessed a price increase, from approximately £1,800 in January to a current trading value of about £2,900.

The LSE issued a declaration saying, “To grant an opportunity for the maximum number of issuers to join the trading debut, we’re scheduling the Crypto ETNs market opening for 28 May 2024. By setting this date, we have aimed to accommodate issuers adhering to the Crypto ETN factsheet requirements for listing and, crucially, afford those aiming to issue securities on this date enough preparation time to assemble documents for a Crypto ETN program, which will need a base prospectus approved by the Financial Conduct Authority.”

Those wishing to participate on the 28th of May must have their applications submitted by 15 April and acquire FCA endorsement by 22 May.

The domain of cryptocurrency trading is laden with contention due to the foundational volatility of the asset values. The Financial Conduct Authority has persistently forewarned investors of the potential to lose their entire capital when delving into this sector.