21Shares expands crypto offering with world’s first Solana ETP

Jul 1st, 2021 | By | Category: Alternatives / Multi-Asset

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Digital asset ETP specialist 21Shares has introduced the world’s first ETP providing exposure to SOL, the native token underpinning the Solana blockchain.

Hany Rashwan, CEO of 21Shares.

Hany Rashwan, CEO of 21Shares.

The Solana SOL ETP has listed on SIX Swiss Exchange in US dollars (ASOL SW) and on Boerse Stuttgart in euros (21XL GS).

Solana, which officially launched in March 2020, is a highly functional open-source project providing decentralized finance solutions.

Solana’s main innovation is its proof-of-history consensus which leads to incredibly short validation times of less than half a second (compared to 15 seconds for Ethereum and around 10 minutes for Bitcoin) and allows the blockchain to handle thousands of transactions per second.

The protocol is designed in such a way as to have low transaction costs while still guaranteeing speed and scalability.

Due to its lightning-fast validation times, Solana has attracted a lot of institutional interest, and SOL is currently the fourteenth-largest cryptocurrency globally when ranked by total market capitalization.

The ETP uses full direct, so-called ‘physical’ replication with each share being 100% collateralized by a corresponding investment in SOL. Each unit of the ETP will be backed by approximately 0.69 SOL at launch.

Physical (in a digital sense) tokens are stored using institutional-grade custody solutions with Coinbase providing custody services.

As well as tracking the price performance of SOL, the ETP also offers an additional yield by staking its tokens in order to validate transactions on the blockchain.

SOL holders can stake their tokens with validators as part of the blockchain’s consensus mechanism. A successful validator then shares some rewards with those who have staked. This reward mechanism incentivizes validators and delegators to act in the network’s interest.

The ETP comes with an expense ratio of 2.50%.

21Shares has introduced several innovative crypto ETPs this year. In February, it unveiled the 21Shares Polkadot ETP (ADOT SW; PDOT GY), the world’s first ETP providing exposure to DOT, the token underpinning the Polkadot multi-chain.

More recently, in April, it launched the Cardano ADA ETP (AADA SW; DADA GS) and the Stellar XLM ETP (AXLM SW; XLME GS) – the world’s first ETPs providing exposure to ADA and XLM, the native tokens underpinning the cardano and stellar blockchains respectively.

Hany Rashwan, CEO of 21Shares, said: “Following an active review to extend our innovative and forward-thinking asset launches, we are on track to deliver more new ETPs demanded by clients and, as a result, we remain the market-leading crypto ETP issuer of choice.

“European institutions continue asking us for simple and effective access to these new blockchain technologies which we can deliver based on our successful track record. We expect to add two new crypto ETPs in the next few months, together with new listing and trading venues.”

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