21Shares Research Newsletter - Issue 73

Market Outlook

One of the best performing assets over the last week has been Binance Coin (BNB) — the token issued by Binance, the world’s leading crypto exchange. For reference, nearly a year ago we partnered with Binance to launch the world’s first institutional vehicle for BNB — a noteworthy achievement — in the form of the 21Shares Binance BNB ETP (ABNB | ISIN: CH0496454155). Since the public launch of our ETP on October 15, BNB has increased in value by 66.07%, outperforming Bitcoin (26.49%) over the same time frame.

The growth of the asset over the last week has been instigated by the launch of a $100MM fund to help incubate DeFi upstarts on Binance’s own blockchain and the launch of several DeFi applications on the chain. The chart below compares the cumulative returns of the 21Shares Binance BNB ETP over the last two weeks compared to one of the SIX Swiss Exchange’s most popular assets — the Invesco S&P 500 UCITS ETF (SPXD). ABNB returned 43.27% over the last week compared to 0.48% for SPXD.

It is rare that investors are able to access early-stage, high-growth assets such as BNB, ETH, and BTC through a regulated framework and exchange such as what is offered by 21Shares’ range of products. We believe that BNB, alongside the other cryptoassets which are supported by our ETPs, will continue to present an important growth investment in the foreseeable future.

Weekly Returns

The entire cryptoasset market had a much more positive week, after struggling for the first time following a summer-long bull run. It’s likely that both Bitcoin and Ethereum will continue to test their $12,000 and $400 resistance levels which presents an optimistic upside for the entire market, especially lower-cap DeFi assets which often serve as high beta on the two dominant cryptoassets — BTC (5.48%), ETH (11.61%), XRP (4.05%), BCH (1.44%), and LINK (3.08%).

Media Coverage

For our German-speaking audience, our Managing Director, Sina Meier appeared in BX Swiss TV — hosted by the Swiss stock exchange, for an interview discussing the structure and uniqueness of our crypto ETPs and how they meet the growing demand for a variety of investors. Watch the full interview here.

ABTC, our 100-percent-collateralized Bitcoin ETP is now available on Nordnet Bank AB! With over 1.2M customers and facilitating more than 28M traders, Nordnet is the number 1 choice for Nordic investors in Sweden, Norway, Denmark, and Finland. Learn more about our Bitcoin ETP (ABTC) here and for our Nordic audience, you can access our Bitcoin ETP on Nordnet here.

News - Pandemic Will Speed Bitcoin Adoption, Says DBS Bank Economist | CoinDesk

What Happened?

The Managing Director of DBS Bank, Taimur Baig, a Singapore-based multinational bank with over $570 billion in AUM, reported to CoinDesk about the accelerating organic demand from institutional investors willing to get exposure to Bitcoin. These institutional investors usually, family offices and high-net-worth individuals not only in Singapore but also across Europe, have started to recognize the benefits of Bitcoin as a long-term growth investment and a hedge against currency debasement.

Why Does It Matter?

There are many reasons for the explosion in European interest in Bitcoin, but the primary reason is indisputably the fact that Bitcoin has been the best-performing asset of the last decade and since the start of the year. In addition, the community of European investors never had so many available choices in Europe to select the most cost-effective, regulated and centrally cleared crypto ETPs for their needs as the chart shows below. Noticeably with 21Shares alone issuing eleven exchange-traded (ETPs) that are available on five exchanges across Europe — Wiener Börse, Deutsche Börse, SIX Swiss Exchange, Börse Stuttgart, and BX Swiss.

Bitcoin has returned 45.76% since the start of the year compared to 4.60% for the S&P 500, -12.10% for the EURO STOXX 50, and 26.07% for Gold. The outstanding performance of Bitcoin even just this year helps show how it serves as the ideal investment for investors seeking a high-growth asset, in a world where existing tech stocks are fully valued and interest rates on low-risk assets are zero.

Rates will remain at their present or lower levels, in other words potentially entering into negative territories, given the European Central Bank’s announcement last week. As the ECB continues its asset purchases under the pandemic emergency purchase program (PEPP) of € 1.3 trillion, at 21Shares, we anticipate a considerable amount of inflation across traditional assets like stocks in Europe which will contribute to strengthening the value of Bitcoin going forward.

Learn more here.