Making crypto accessible
21Shares | Best Crypto Issuer - 21Shares’ Co-founders Chief Product Officer and President, Ophelia Snyder and Chief Executive Officer, Hany Rashwan, wanted to make crypto assets accessible via the ETP structure and build bridges into the crypto world.
What sounds simple was not and after a long journey through various jurisdictions they arrived in Switzerland and the SIX exchange, as Switzerland offers very clear guidelines for crypto regulations and financial products, says Isabell Moessler, Head of Distribution for the EMEA region for the firm.
The company was founded in 2018 and there’s never a dull week indeed where the firm does not bring another crypto asset to the market. The firm launched with a crypto basket product on SIX, swiftly followed by single asset products, currently totalling 28, and listings across all the European exchanges.
The most recent launch has been an ETP based on Decentraland, the first decentralised and user-owned virtual reality platform that allows users to create, experience, and monetise content and applications including purchase of virtual land.
“The two co-founders wanted to give easy access into the space and the ETP wrapper had proven itself from the demand side,” Moessler says. The firm’s assets are volatile, unsurprisingly given the nature of the underlying, and exceeded USD2.5 billion last year but now sit at USD1.8 billion.
“AUM are affected by price movements in the market,” Moessler says. “But net new assets last year were over USD1 billion and are standing above USD60 million this year, on a steady flow of assets.”
Moessler says that more and more people understand the fundamentals of investing in crypto and see price drops as buying opportunities.
“Crypto is our space,” she says. “It’s what we do, where we have the expertise and where we differentiate ourselves from our competition. You have many ETP issuers that offer ETPs in traditional asset classes, we don’t…but if you are looking to get into the digital asset space, we can help and we can explain it all at a high level or with as much detail as you want.”
Moessler has a 17-year experience with ETF firms, including iShares, ETF Securities and most recently at the European exchange group Euronext. “I have come in with a traditional financial background, but many of my colleagues are crypto natives who are really in the weeds, understand details and developments in this space and this is where we provide value to investors.”
The firm has what it calls an ambitious internal pipeline of new products, all listed on regulated markets.
“We have strong support from our authorised participants and market makers who ensure liquidity on exchange and the liquidity of the underlying is one of the key criteria before we launch a product, exactly the same as with a launch within the equity or fixed income space,” she says.
The current list of single assets plus baskets and combinations all sit in the top list of cryptocurrencies by market capitalisation. “As with traditional asset classes, we would not be able to launch a token on a protocol where liquidity was not given,” she says.
When Moessler joined iShares in 2005 she had to explain what an ETP was with active managers complaining that ETPs were ‘eating their lunch’ as she puts it. “The conversations we are having now are very similar in regards to innovation and entering a new space.”