VanEck, a global investment manager has made an entrance into the European market with its first crypto ETF called VanEck Vectors Digital Assets Equity UCITS ETF (DAPP). The ETF is already listed at the London stock exchange and Deutsche Boerse.
DAPP tracks the performance of the digital asset companies included in the MVIS Global Digital assets Equity Index. The index includes 26 digital asset companies. For a company to qualify in the index it must derive more than 50% of its income from digital asset projects including crypto mining companies, payment firms, software, and more.
VanEck would track the progress in the performance of these companies by looking at the amount of cryptocurrency in their balance sheets and the liquidity of their digital assets. It is the first company in the European market to engage in specific digital asset projects.
The move comes after VanEck was denied in 2017 and then delayed on re-application by the US Securities and Exchange Commission. It was denied in 2017 citing reasons of the small market cap of digital assets which could possibly lead to market manipulation which isn’t small anymore. The next date for deliberation hearing on the application is June 21, 2021.
As crypto ETF expands to Europe it could pave way for the approval of the first Bitcoin ETF in the United States.
The Director of Digital Assets Strategy at VanEck Garbor Gurbacks believes that this could be a transformational moment for the industry. He said that the product was aimed at people who do not want to directly invest in the market because of its volatility but want to bet on it in a safer way. This would let investors benefit from the positive development in the sector.
Gurbacs went on to say, “It’s great to see a pure-play crypto equity ETF come to market in Europe”.
Martijn Rozemuller, CEO in Europe at VanEck, quoted to media: “The digital transformation is changing large parts of our economy. This is not just short-term hype, but rather is a long-term, structural development. Blockchain applications are finding more areas of use that now extend way beyond cryptocurrencies. Consequently, investors are increasingly looking to digital assets for investment opportunities.”