Jamie McNeill
21Shares is a Swiss company that has decided to shut down six crypto exchange traded products (ETPs) thanks to a lack of demand.
They will be closing their Crypto Layer 1 ETP, DeFi 10 Infrastructure ETP, S&P Risk Controlled Bitcoin Index ETP, S&P Risk Controlled Ethereum Index ETP and USD Yield ETP, as well as their Terra fund.
This comes at the same time that other exchange traded products are trying to gain legitimacy in the crypto space, and Grayscale is attempting to convert into an ETF.
All six 21Shares ETPs have been live for less than a year
Hany Rashwan has stated that the delisting of these products isn’t indicative that the products weren’t useful, but that they simply represented such a small portion of the company’s AUM (0.6%) that it would be better for the company to allocate their resources elsewhere.
As of the time of writing, the total AUM held in these ETPs stands at just $700k, which means that the company isn’t generating enough revenue from fees to be able to justify continuing to offer these products.
Moreover, the company remains highly profitable in their other enterprises, and has continued to have record earnings this year.
When we see decreased demand for products, we usually delist. The focus is on what our customers want!
That's what happened here. The 6 ETPs have <0.6% of our AUM & we see strong demand everywhere – esp after closing our 2nd best Jan in company history.https://t.co/wmI6Svp4Bt
— Hany Rashwan (@hany) March 17, 2023
It is possible that one of the main reasons that there was so little demand for the ETPs was thanks to the fact that the bear market had come into full swing – each ETP had been live for less than a year.
Terra ETP terminated thanks to LUNA collapse
Whilst the other five ETPs were terminated due to lack of investor demand, the Terra ETP is scheduled removed thanks to the complete collapse of the project, which saw over $40 billion worth of value evaporate overnight.
The fund has offered exposure to LUNA (now LUNC), and will continue to be in operation until June 12th, by which time investors will have to retrieve their remaining assets.
Relevant news:
- Indian Crypto Exchange WazirX Closes its NFT Marketplace, Cites Bear Market
- Amazon Digital Marketplace for NFTs Launches April 24th and they will be Tied to Physical Assets
- Our Cryptocurrency Guides
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This article was written for Business 2 Community by Jamie McNeill.
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