Britain’s Largest Broker Offers Exchange-Traded Bitcoin Investments

By Kevin Helms 

Britain’s leading brokerage firm, Hargreaves Lansdown, now offers bitcoin exchange-traded products to its 876,000 customers. These investments are available for regular brokerage accounts as well as self-invested personal pension accounts.

Largest British Broker

Britain's Largest Broker Offers Exchange-Traded Bitcoin InvestmentsHargreaves Lansdown plc is a financial service company based in Bristol, a city in South West England. The company “is the UK’s number 1 ‘investment supermarket’ for private investors,” according to its website. With 876,000 clients and more than £70 billion traded, the company currently offers “more than 2,500 funds, UK, US, Canadian and European shares, ETFs, investment trusts, bonds and gilts.”

Different types of accounts are available through its investment platform, also known as the Vantage Service. They include regular brokerage accounts, tax-efficient Individual Savings Accounts (ISA) and Self-Invested Personal Pension (SIPP) accounts.

Bitcoin Investments Available

Britain's Largest Broker Offers Exchange-Traded Bitcoin InvestmentsOn Thursday, June 1, two bitcoin investments were added to Hargreaves Lansdown’s platform; Bitcoin Tracker One and Bitcoin Tracker Eur. Listed on Nasdaq Nordic in Stockholm, the former is denominated in Swedish krona (SEK) and the latter in the euro (EUR). Both are issued and managed by Stockholm-based XBT Provider AB, with Global Advisors (Jersey) Limited as the guarantor.

Both instruments are bitcoin Exchange-Traded Notes (ETNs) which are debt securities backed by the credit of the issuer. They track the price performance of bitcoin, giving investors exposure to the digital currency. However, investors do not own the bitcoin itself. Danny Cox, Head of Communications at Hargreaves Lansdown, told the Telegraph that “We have seen a handful of clients asking for the ETN.”

XBT Provider describes its products:

The certificates will provide an exposure to the performance of the digital currency bitcoin as priced in USD on the Primary Marketplaces. Holders of certificates will have exposure to both the performance of bitcoin and the fluctuations in the relevant foreign exchange rate.

The primary marketplaces listed in the ETNs’ prospectus are Okcoin, Kraken, Bitstamp, Bitfinex, Itbit, Gemini, Gdax, and Gatecoin. The foreign exchange rate risk for Bitcoin Tracker One is USD/SEK whereas it is USD/EUR for Bitcoin Tracker Eur.

While the certificates are denominated in SEK and EUR, they track the price of bitcoin in USD. “As the BTC/USD market is the most liquid bitcoin market widely available for trading, we regard it as the most suitable underlying asset in a bitcoin product,” the company explained.

Both ETNs are currently available for Hargreaves Lansdown investors with regular brokerage accounts or SIPP accounts, but not tax-advantaged ISA accounts. The brokerage firm charges £11.95 per trade to start investing in these instruments but the cost decreases with the number of trades.

Bitcoin Investment Trust No Longer Available Online

Britain's Largest Broker Offers Exchange-Traded Bitcoin InvestmentsBarry Silbert’s Bitcoin Investment Trust (GBTC) also used to be available for online trading on the Hargreaves Lansdown platform for regular brokerage accounts, but not SIPP or ISA accounts.

However, the brokerage firm has posted a notice on its website which reads: “Bitcoin Investment Trust NPV cannot currently be traded online. For further information about trading this security, or to obtain a current price, please telephone our dealers.” This restriction is likely due to the trust having applied to list and trade on the NYSE Arca exchange. Its application is now pending approval by the U.S. Securities and Exchange Commission (SEC) as a bitcoin Exchange-Traded Fund (ETF).

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