Amsterdam-based Flow Traders NV is the largest trader of exchange-traded funds (ETFs) in the European Union, recording some $284 billion in such trades in the first quarter of 2018 alone. The firm will oversee no less than a third of all ETF trades in Europe this year.
As the international crypto community awaits news of the SEC decision on a Bitcoin ETF, Flow Traders are striding ahead regardless. The firm is invovled in pioneering moves to offer the world’s first exchange-traded notes (ETNs) based on Bitcoin and Ether. Co-CEO Dennis Dijkstra commented that he felt people “underestimate” crypto and said that “institutional investors are interested – we know they are because we get requests.”
ETNs are a type of security which are typically linked to the underlying price of an asset but, unlike ETFs, do not own any of the asset on which they are based. Swedish ETN-issuer XBT Provider, part of CoinShares Limited, noted a significant rise in Flow Traders’ usage of ETN securities during 2018. The firm are reportedly hedging the risk of offering investments in the notoriously volatile crypto markets by buying futures contracts with the Chicago Board Options Exchange (CBOE) and CME Group.
Dijkstra’s endorsement of the crypto space stands in stark contrast to the Netherlands’ financial markets regulatory body, who are on record as saying that not only is crypto “very prone to abuse”, but that they “don’t regard it as an asset class” at all. The country has been outspoken in their perceived need for regulation in the space, with finance minister Wopke Hoekstra on record as demanding “an international approach” to policy and practice in Spring 2018.
