Crypto algorithmic trading firm and liquidity provider, Wintermute, has announced that it has been selected by digital ETP issuer ETC Group to serve as the primary liquidity provider for ETC Group’s newest cryptocurrency linked ETP, the MSCI Digital Assets Select 20 ETP (DA20).
The firm writes that DA20 is the first crypto ETP based on an MSCI index and will be physically backed with Komainu acting as the primary custodian who will hold the assets in cold storage.
Wintermute writes that it will play an integral role in the execution mandate for creations and redemptions of the DA20 as well as the rebalancing of the basket of crypto assets. The newly created ETP is a fully regulated product aimed at institutional market participants and provides unique diversified exposure to digital assets for those investors who previously were unable to gain access to the performance of the underlying digital assets. As the primary dedicated liquidity provider, Wintermute will be fully responsible for the daily execution required for the optimisation of the underlying assets constituents by providing full transparency and operational efficiency.
Evgeny Gaevoy, CEO and Co-Founder of Wintermute, says: “We are looking forward to working with ETC Group to provide institutional clients with access to the crypto ecosystem through regulated digital asset securities. This ETP presents an opportunity for investors to diversify their portfolio while familiarising themselves with crypto as an asset class. Additionally, by leveraging our ability to offer competitive liquidity for high-volume crypto trades, investors will know that they are able to best take advantage of any market presented by the DA20. We are confident that this product will satisfy the demands of institutional investors, further bridging the gap between the crypto and traditional markets.”
DA20 is based on an index provided by MSCI Inc and will track the performance of the MSCI Global Digital Assets Select Top 20 Capped Index, an index that represents a basket of the 20 leading digital assets. The index, which was developed by MSCI with ETC Group’s input, was launched in early March and currently tracks assets such as Bitcoin (BTC), Ethereum (ETH), and Solana (SOL). The index will be rebalanced quarterly and weighted in a manner that enables investors to gain broad and trusted exposure to the largest disruptive digital assets, offering a diversified entry. The index methodology can be found here.
Tim Bevan, Founder and Co-CEO at ETC Group, says: “We are very proud to announce this new relationship with Wintermute, one of the world’s leading providers of liquidity within the digital asset space. By integrating their capabilities into our platform, we will be able to provide a sophisticated new range of products of which the MSCI Digital Assets Select 20 ETP will be first. This ETP provides investors the first genuine broad-market index product to allocate exposure to this new and exciting asset class.”
The product is physically backed by the respective current components of the MSCI Global Digital Assets Select Top 20 Capped Index, and the assets will be securely held by Komainu, a digital asset custody solution that provides institutional-grade security to its clients. The product will initially be listed on the German stock exchange Xetra and will have further listings throughout Europe.