London, March 12, 2024 – The London Stock Exchange (LSE) is gearing up to welcome crypto-tied exchange-traded notes (ETNs) as it announced the commencement of the application process for Bitcoin (BTC) and Ethereum (ETH) in the second quarter of 2024. The official press release on March 11 revealed the LSE’s intent to facilitate the admission of crypto ETNs, with the exact launch date yet to be disclosed, awaiting further announcement “in due course.”
As outlined in the crypto ETN factsheet, trading on the LSE will be limited to professional investors within designated trading segments. The factsheet further indicates that issuers have the flexibility to provide up to three distinct currency lines for each crypto ETN.
Emphasizing the importance of secure custody, the document stipulates that the underlying crypto assets for ETNs must primarily reside in cold storage. Although the LSE does not delve into further details on this matter, it underscores the requirement for custodians to adhere to anti-money laundering regulations across jurisdictions such as the U.K., E.U., Jersey, Switzerland, or the U.S.
Following the news, Bitcoin witnessed a rapid surge, surpassing $71,000, while Ethereum also experienced a notable climb above $4,000. The extent to which the LSE’s decision influenced these price movements remains uncertain.
This move toward integrating crypto assets into traditional financial markets is not entirely unprecedented for the London Stock Exchange, which has been actively exploring the potential applications of blockchain technology. In September 2023, the London Stock Exchange Group unveiled plans to introduce blockchain-based trading for conventional financial assets, signaling a strategic shift driven by the anticipated advantages of blockchain integration within traditional markets.
