Benefits of ETP versus hedge funds or UCITs funds

Offshore hedge funds :

ETPs (Exchange-Traded Products) offer greater liquidity, transparency, and accessibility compared to offshore hedge funds, making them ideal for retail and institutional investors seeking low-cost, daily tradable vehicles with clear regulatory oversight—especially when structured under frameworks like issuance.swiss. In contrast, offshore hedge funds cater to high-net-worth and institutional investors seeking complex, high-return strategies with fewer regulatory constraints, but come with higher fees, limited liquidity, and less transparency. While ETPs are more scalable and efficient for broad market exposure or passive strategies, offshore hedge funds are better suited for niche, high-alpha opportunities requiring operational flexibility.

UCITs Fund:

ETPs (Exchange-Traded Products), offer key advantages over traditional UCITS funds, including intraday liquidity, real-time pricing, lower costs, and greater transparency through daily portfolio disclosures. They are easily accessible via public exchanges and are often more scalable and cost-efficient to launch—especially using white-label platforms. UCITS funds, while also highly regulated and retail-friendly, trade only once daily at NAV and typically involve higher management fees and longer setup times. While both structures provide strong investor protection under EU regulation, ETPs are better suited for investors seeking flexibility, efficiency, and transparent, exchange-traded access.

Benefits of whitelable solution

Opting for a white-label ETP/ETF solution, offers significant advantages over launching a proprietary Exchange-Traded Product (ETP). This approach streamlines the process, reduces costs, and provides access to established infrastructure and expertise.

Key Benefits of White-Label ETP/ETF Solutions

1. Cost Efficiency
   Launching an ETP/ETF independently can incur substantial expenses, including legal fees, infrastructure setup, regulatory compliance, and marketing. White-label platforms mitigate these costs by providing shared services and infrastructure, significantly lowering the financial barrier to entry.
2. Accelerated Time to Market
   Developing and launching an ETP/ETF from scratch can be time-consuming. White-label providers offer ready-made frameworks and regulatory approvals, enabling asset managers to bring products to market more swiftly.
3. Access to Established Distribution Networks
   White-label platforms often have extensive distribution and marketing channels. By leveraging these networks, asset managers can achieve broader market reach and visibility without building relationships from the ground up.
4. Regulatory and Operational Support
   Navigating the complex regulatory landscape of ETP/ETF launches can be daunting. White-label providers handle compliance, reporting, and operational logistics, allowing asset managers to focus on investment strategy and client engagement.
5. Scalability and Flexibility
   White-label solutions offer scalability, accommodating asset managers who wish to launch a single ETP/ETF or expand a suite of products. This flexibility supports growth and adaptation to market demands.
6. Risk Mitigation
   The shared infrastructure and expertise of white-label platforms reduce the operational and financial risks associated with launching new ETP/ETFs. This model allows asset managers to test innovative strategies with lower exposure

In summary, utilizing a white-label ETP/ETF platform provides asset managers with a streamlined, cost-effective, and efficient pathway to enter the ETP/ETF market, leveraging existing infrastructure and expertise to focus on delivering value to investors. Why do your own when you can outsource it !

The Rise of Exchange Traded Products

Exchange-traded products (ETPs) provide a convenient, regulated, and cost-effective avenue for both retail and institutional investors to engage with various underlying investments, and the realm of digital assets is no exception.

Since the inception of the initial bitcoin tracker in Sweden in 2015, digital asset ETPs have transcended their primarily European presence, evolving into a globally expanding market. The number of these products has surged from a mere 17 at the close of 2020 to approximately 180 available for trading today. With an increasing number of traditional financial institutions joining forces with digital asset-native companies to issue ETPs, it is becoming evident that these instruments play a crucial role not only in broadening investor access to digital assets but also in fostering the wider acceptance and integration of digital assets in global financial markets.

Exchange-traded products (ETPs) represent a class of financial instruments traded on regulated stock exchanges during regular trading hours, mirroring the performance of an underlying benchmark, asset, or portfolio.

This category encompasses three primary types of ETPs: exchange-traded funds (ETFs), exchange-traded notes (ETNs), and exchange-traded commodities (ETCs). While ETFs function as investment funds, ETNs and ETCs take the form of debt securities. ETCs specifically monitor physical commodities like gold and oil, while ETNs cover a broad spectrum of other financial instruments. Since the inception of the inaugural ETF in 1993, marking its thirtieth anniversary this year, ETPs have evolved from mere equity market trackers to arguably one of the most groundbreaking investment product categories, offering investors exposure to a diverse range of innovative underlyings.

Especially in the last two decades, these financial instruments have demonstrated consistent expansion, culminating in a global presence of 11,859 products and 23,931 listings. These offerings originate from 718 providers listed across 81 exchanges in 63 countries. Among them, ETFs constitute the predominant share of assets, representing $10,747 billion or 98% of the overall $10,990 billion in ETP assets (according to data from ETFbook as of the end of November 2023). Oliver Wyman anticipates a heightened growth trajectory for ETFs, forecasting an annual growth rate ranging from 13% to 18% from 2022 to 2027.

 ETP as an institutional gateway to digital assets

Laurent Kssis, a prominent figure in the crypto ETP space and independent board member of issuance.swiss AG, has articulated several benefits of Exchange-Traded Products (ETPs) for investors:

“The ETP structure itself is proven and tested… Even when products have had to delist during events like Terra and FTX, it is because there was no sourcing of the underlying asset, but the actual structure and the product itself did what it said on the tin. These conventional ETPs will allow investors to diversify their portfolios by adding assets that we believed in before many others, and that we believe are essential in successful portfolio allocation.”

In summary :

• ETPs provide a regulated and accessible avenue for investors to gain exposure to cryptocurrencies without the complexities of direct ownership.
• ETPs offer a strategic advantage in incorporating emerging assets like cryptocurrencies into traditional investment portfolios.
• The robustness of ETPs as investment vehicles allows them to maintain their integrity even when underlying assets face challenges.