More institutional investors entering the market? Bitcoin-traded bonds become a new favorite of banks

Danish multi-asset trading house Saxo Bank has said it will allow users to acquire Bitcoin after adding a Bitcoin-based exchange-traded note (ETN).

Saxo Bank mentioned that interest in Bitcoin began to grow rapidly in 2017. This was mainly because the Asian markets, especially China and Japan, had opened up. This meant that a large number of Bitcoin transactions were generated in these countries.

The bank's move shows that investors and speculators are looking for a new way to trade bitcoin without having to directly touch the asset. Bitcoin's widespread use in Latin America, Greece, Africa and other regions has also stimulated the creation of several emerging markets.

Saxo Bank offers Bitcoin ETN

In light of the analysis of all market activity and Bitcoin’s popularity, Saxo Bank decided to offer Bitcoin exchange bonds. This fund can provide investors with indirect exposure to Bitcoin prices. According to reports:

Saxo Bank has added two new exchange-traded notes (ETNs) to its portfolio, allowing clients to track the price of the Bitcoin (BTC) and U.S. dollar (USD) pair through the two new ETNs.

One of the bonds is called “Bitcoin Tracker One” and is traded in Swedish krona, while the other is called “Bitcoin Tracker Euro” and is traded in euros. Both bonds are reportedly issued by XBT provider AB and traded on the Nasdaq Stockholm exchange.

Bitcoin ETN demand surges

The growing speculative demand for Bitcoin has led to more and more trading companies entering the field.

Recently, more and more online trading platforms have begun to try to meet customer demand for virtual currency products. In July this year, Swissquote, a leading online bank in Switzerland, launched a Bitcoin trading option on its trading platform.

The Swissquote platform operates similarly to the foreign exchange market. Users deposit euros and dollars into their accounts and bind these funds to Bitcoin. However, the Bitcoin bonds purchased by investors cannot be leveraged. Babbitt reported the news of Swissquote's entry into the cryptocurrency ecosystem:

Swissquote Bank, Switzerland’s leading online financial and trading services provider, has partnered with Bitcoin exchange Bitstamp to offer Bitcoin trading services to more than 200,000 private and institutional investors.

The exchange market IG group also seems to have entered the cryptocurrency space. They mainly trade Ethereum. Their clients can buy bonds based on the rise and fall of Ethereum.