More cryptocurrencies on the WSE from Wednesday. The Swedes announce: 10 instruments will appear by the end of the year
– Entering the Polish market is part of our long-term strategic plans – says Christopher Kock, president and co-founder of the Swedish company Virtune, to Bankier.pl. Already on Wednesday, four ETP instruments managed by this company appear on the Warsaw Stock Exchange, giving investors exposure to the cryptocurrency market and quoted in Polish zloty.
The Swedish issuer, which currently manages approximately $250 million in crypto assets, has ambitious plans. The company has been operating on the market since 2022 and is developing extremely dynamically – last year alone it acquired approximately EUR 200 million of new assets, which was the fourth result in this industry in Europe. The goal is to reach $1 billion in assets under management (AuM) by the end of this year, and the Polish market is expected to play a significant role in this.
In Poland, the market is developing faster
Why did Virtune decide to enter Poland now? In an interview with Bankier.pl, Christopher Kock points to the combination of several favorable circumstances. He draws attention primarily to the rapid development of our economy, which has moved up to 20th place in the world, as well as the growing adoption of cryptocurrencies, faster than, for example, on Nordic markets. The dynamic increase in Poles' interest in regulated investment channels is also important for the Swedish issuer – the number of brokerage accounts is growing rapidly, and the turnover of ETF instruments in Warsaw more than doubled last year.
– As cryptocurrencies mature, investors are looking for regulated investment channels to gain exposure to this asset class – explains Virtune's president.
Investors from the Warsaw Stock Exchange already have access to an ETF based on bitcoin futures contracts. You can also invest in cryptocurrencies in other ways – by purchasing them directly on Polish or global crypto exchanges, such as Coinbase or Binance, or by investing in companies that own cryptocurrencies, such as Bitmine or Strategy. What are the advantages of the products offered by Virtune?
– Our products are designed to maximize investor protection, transparency and minimize all forms of credit risk towards us as a supplier – emphasizes the president.
Full coverage in base currencies
Virtune instruments are distinguished by full physical coverage, which in practice means that each issued ETP is 100% secured by the underlying cryptocurrencies.
– If a Polish investor buys our Virtune Bitcoin Prime ETP for PLN 1,000, we will always store the equivalent in the underlying crypto assets – explains Christopher Kock.
The Swedish issuer places great emphasis on security and transparency. The collected assets are stored offline (so-called cold storage) by Coinbase, the world's largest institutional cryptocurrency custodian. Moreover, thanks to integration with the Chainlink Proof of Reserve solution, every investor can independently verify at any time whether exchange instruments are actually fully covered by digital assets.
Four instruments will appear on the WSE on Wednesday:
- Virtune Bitcoin Prime ETP (with 0.25% annual management fee)
- Virtune XRP ETP (1.49% management fee)
- Virtune Staked Solana ETP (0.95% management fee)
- Virtune Staked Ethereum ETP (1.4% management fee)
The choice is not accidental – these four cryptocurrencies together represent over 70% of the entire market.
A way to improve results or a risk?
Importantly, products based on Ethereum and Solana offer the so-called passive staking (staking). This is a mechanism in which blocked funds help secure the blockchain network, generating additional interest in the same cryptocurrency for the investor in return.
– This is a way to improve investment results in the long run thanks to staking rewards – explains Kock. – These rewards are added to the net asset value on a daily basis. In Solana's case, staking generates around 3% return per year, which more than covers the management fee. For Ethereum, rewards are currently around 1.1% per year, says the head of Virtune.
However, it confirms that staking is associated with certain risks – temporary blocking of funds (although an investor who has an ETP product can sell it at any time, because not all assets are staked) and the risk of validator error (so-called slashing). However, the company minimizes this risk by working only with Coinbase, which has never recorded this type of incident.
Goal by the end of the year: 10 products. OKI can help
The company plans to introduce a total of 10 products to the Polish market this year. Today, its offer on several European stock exchanges (Stockholm, Helsinki, Paris, Amsterdam, Germany) includes a total of 22 products, including instruments based not on one cryptocurrency, but on the entire basket, analogous to index or sector ETFs investing in shares.
– As the cryptocurrency market matures, there is an increasing demand for basket or index exposure. We also plan to introduce products enabling such exposure in the future on the Polish market, confirms Kock.
Virtune sees great potential in Poland in the use of retirement accounts – IKE and IKZE, through which it will be possible to invest in new products without capital gains tax. It also hopes to introduce OKI accounts. The latter imitate Swedish ISK accounts to some extent. – Thanks to ISK retirement accounts, investors in Sweden can avoid a 30% interest rate. tax on profits when purchasing crypto directly on the stock exchange, paying only a flat-rate tax – emphasizes Kock.
Animators ensure adequate liquidity of Virtune instruments. On the Warsaw Stock Exchange it will be Raiffeisen Bank.
The Swedish issuer, whose products are already used by over 160,000 investors – the vast majority of them in Sweden – intends to focus heavily on investor education. – Initially, we want to focus on building trust, awareness and liquidity of our products and on educating the market. We are in the process of selecting a country manager who will be responsible for the Polish market. We will appear at industry events, says Kock.
