WisdomTree adopts multi-custodian model for Bitcoin ETP

WisdomTree has adopted a multi-custodian model for its physically-backed Bitcoin ETP following the appointment of Coinbase Custody.

The physically-backed, WisdomTree Bitcoin ETP (BTCW) listed on SIX, the Swiss Stock Exchange, in December 2019 with a total expense ratio of 0.95%.

The appointment of Coinbase Custody as a second custodian for BTCW complements the existing custody solution provided by Swissquote, a regulated and listed Swiss bank.

Coinbase Custody offers access to a secure, institutional-grade offline storage solution built around a proprietary, best-in-class key generation protocol which generates cold storage addresses for Custody wallets.

The Coinbase Custody solution leverages the same cold storage architecture that underpins Coinbase's custody of more than $20bn[2] in crypto assets for its customers. In addition to greater security, Coinbase Custody offers the industry's leading insurance policy providing further reassurance for investors.

Jason Guthrie, head of capital markets and digital assets, Europe, WisdomTree, added: "A multi-custodian model further enhances the robustness of our operating set up, adding flexibility and enhanced security as we diversify service providers for a key function.

"Adopting a multi-custodian model signals our focus on innovations which benefit investors. Institutional interest in bitcoin continues to grow and this approach will resonate with those seeking the most robust security procedures for transacting in and safekeeping of cryptocurrencies".

In addition to institutional class custody solutions for investors, the ETP wrapper has added new dimensions to the cryptocurrency universe, such as more liquid and transparent trading and a broader array of more sophisticated market participants entering the arena for these products.

Moving to a multi-custodian model will provide enhanced connectivity between WisdomTree and the wider cryptocurrency market, potentially providing greater liquidity for bitcoin, the underlying digital currency.

The WisdomTree Bitcoin ETP provides investors with a simple, secure and cost-efficient way to gain exposure to Bitcoin. The ETP allows investors to access Bitcoin without the need to hold the cryptocurrency directly, store private access keys or interact with the blockchain or digital currency infrastructure in any way.

Jason added, "Digital currencies are here to stay, and we will continue to ensure we have the most secure, robust and innovative offering possible. We believe the development of a multi-custodian model is key to enhancing investor confidence as they look to enter into this new and rapidly growing asset class."