by Joseph Young
Bitcoin certificate has become the most traded structured product on the traditional Swiss stock exchange, according to local sources.
Initially, issuers of the bitcoin certificate being traded on the Swiss stock exchange released 20 million Swiss franc worth of certificates, which is worth around $20 million. As demand started to increase from both individual and institutional investors, the supply of bitcoin certificates was increased by the issuers, to 40 million francs (approximately $40 million).
Within a relatively short period of time, bitcoin certificate has become the most traded structured product on the Swiss stock exchange, with consistent mainstream media coverage from well-respected financial media networks such as the Wall Street Journal as well as recognized regional mainstream media outlets.
In an interview with Swiss daily newspaper Neue Zürcher Zeitung, known for its high-standard of journalism, Bitcoin Association Switzerland’s Lucas Betschart stated that the vast majority of investors still lack proper understanding of the structure, purpose, policies and philosophies of bitcoin.
Like many billionaire investors including Mark Cuban, they are investing in bitcoin and cryptocurrency market to understand the technical intricacies of blockchain technology-based digital currencies better.
Still, Betschart expressed his concerns over the rapid increase in demand for bitcoin and explained that only those that truly see and believe in the technology should buy bitcoin as both a long-term investment and a digital currency.
Betschart admits bitcoin is hyped within the Swiss market and the demand has been evident has the bitcoin certificate that is currently the most traded product on the Swiss stock exchange.
Regulated bitcoin exchange-traded funds such as Grayscale Investments’ Bitcoin Investment Trust (GBTC) have also risen significantly in terms of popularity from institutional and regulated traders over the past few years.
At the time of reporting, GBTC, which represents 10 percent of the bitcoin price, is being traded at $380 per share. That means, in consideration of the price at the time of writing, $2362, it is being traded at around 65 percent premium in regulated markets.
To address the rising demand for bitcoin and cryptocurrencies, financial service providers including Swiss-based firm CryptoFund have launched cryptocurrency portfolios for large-scale traders and institutional investors. According to Neue Zürcher Zeitung, Crypto Fund's index-based and passive fund product will collaborate with qualified investors and establish a portfolio of a wide range of cryptocurrencies.
“The attention and the headlines on cryptocurrencies were the reasons why we started to look at the public with our project," said CryptoFund CEO Jan Brzezek.
Since the beginning of 2017, the price of bitcoin increased from $980 to $2362, surpassing the expectations of investors that have perceived bitcoin as a long-term safe haven asset. However, in Europe and Asia, a growing number of businesses and merchants have started to adopt the cryptocurrency as a legitimate payment method and a digital currency.
Recently, Lieferando, the largest food service provider and delivery platform in Germany, and more than 260,000 restaurants, bars and stores in Japan have started to accept bitcoin as a payment method.
With both demand toward bitcoin as a safe haven asset from institutional investors and as a digital currency from merchants and users rising at an exponential rate, analysts predict bitcoin price to increase at a rapid rate in the upcoming months, especially if some of the technical issues including scaling are resolved.