21Shares has introduced (1) a new exchange-traded product (ETP) called Crypto Staking as an alternative to crypto currency trading that is "Safer and More Secure."
The new crypto currency staking exchange-traded product (ETP) developed by the digital currency company 21Shares has made its debut on the BX Swiss market. This project, a crypto staking index named 21Shares Staking Basket Index ETP, is designed to monitor proof-of-stake (PoS) currencies.
Reports indicate that the company's crypto-staking ETP can track a maximum of ten different Proof-of-Stake digital currencies. It is also the first crypto staking index exchange-traded product (ETP) in the world to provide diversified staking revenue.
On the other hand, Arthur Krause, the director of ETP business at the parent business of the company, 21.co, offered a disclaimer. Krause claims that the Staking Basket ETP does not participate in lending activities.
Instead, the staking effort is a crypto-native method that allows traders to stake assets that help verify blockchain transactions.
Lending, on the other hand, is a time-honored method of financial management that calls for creditors to be reimbursed for the risk that borrowed assets may not be returned as promised.
Krause provided the following explanation about the motivation for 21Shares' decision to develop the Staking Basket Index ETP:
According to our research findings, investors are particularly interested in diverse crypto-native return streams right now, particularly in light of the crypto winter.
In addition, Krause stated again that the crypto currency staking ETP could be a valuable complement to several different investment portfolios.
What is 21Shares ETP
The exchange-traded vehicle instantly begins trading under the ticker symbol STAKE on the local market in Switzerland, known as BX Swiss. In addition, the 21Shares STAKE ETP will initially track six different digital currencies when it is launched. Binance Coin (BNB), Cardano (ADA), Cosmos (ATOM), Polkadot (DOT), Solana (SOL), and Tezos are some of the crypto currencies that fall within this category (XTZ). In addition, to account for changes in the market, this index will undergo rebalancing operations twice a year, in March and September.
Krause emphasized the short-term benefits that the stake provided to investors and explained why they are:
"By employing the ETP's assets to create a passive yield that may give extra returns by contributing to the network's security, STAKE offers value to investors and benefits those investors."
In addition, Krause stressed that the products offered by 21Shares are unaffected by the assets that are popularly related to the bankrupt crypto currency exchange FTX. The director made the following observation when using Solana as an illustration: "Solana, like practically all other crypto assets, saw severe price drops in 2022; yet, it did not suffer any fundamental damage that would bar its inclusion in the index."
Following the integration of STAKE, 21Shares and its parent company, 21.co, now provide 47 crypto exchange-traded product offerings (ETPs) across 12 exchanges located in nine different nations. In addition, these exchange-traded products (ETPs) provide an alternative to direct crypto currency investing, which makes them a safer and more secure option to gain exposure to the crypto currency market.
The introduction of the STAKE ETP comes after 21Shares has been experimenting with staking exchange-traded products for the past few years. The company that deals in digital currencies introduced its 21Shares Tezos Pinning ETP in 2019. (AXTZ). In addition, the Solana Staking ETP (ASOL) was introduced by 21Shares in June 2021.
On the other hand, due to the prolonged bear market, sales of both items dropped significantly in the previous year. Since the start of 2023, ETPs have been enjoying a steady and positive advance. The year-to-date (YTD) increases of 38% and 78% seen in ASOL and AXTZ, respectively, lend credence to this pattern.