European exchange to list Bitcoin ETP carbon neutral
A subsidiary of DeFi Technologies, Valor, will launch its new carbon-neutral bitcoin exchange-traded product (ETP) on the Frankfurt Stock Exchange. ETP trading begins on Friday.
The company positions its ETP as a “sustainable and climate-friendly” exposure to Bitcoin (BTC) with a management fee of 1.49%. Alignment with global environmental goals and environmental, social and corporate governance (ESG) would be achieved through funding certified carbon removal and offset initiatives to neutralize the associated BTC carbon footprint.
To structure the ETP, Valor partnered with Patch – a platform that provides climate action infrastructure and has previously worked with Andreessen Horowitz and other notable institutional investors. The announcement states:
“All investment-related carbon emissions will be automatically targeted to achieve carbon-neutral production using Patch’s API-based solution, which takes into account various inputs, such as the efficiency of the mining equipment, hash power distribution, and country-level carbon emissions data, to estimate the amount of carbon emissions from the Valor portfolio.”
Patch will be responsible for selecting projects based on their environmental integrity. These criteria will include “additionality, actual and verifiable permanence and negativity”.
Related: “The market will decide” Ethereum’s post-merger ETPs, says crypto executive
Valor’s existing ETP offering includes Valor Binance (BNB), Valor Uniswap (UNI), Cardano (ADA), Polkadot (DOT), Solana (SOL), Avalanche (AVAX), Cosmos (ATOM), and Enjin (ENJ) ). In March 2022, the company announced that it had reached $274.2 million in assets under management.
Despite the fall in crypto markets this year, interest in crypto-related financial products is not waning. In July, Swiss crypto investment firm 21Shares launched two new ETPs offering investors exposure to the biggest cryptocurrencies – Bitcoin and Ether (ETH) – while aiming to mitigate volatility via asset rebalancing against the American dollar.