Global X has launched three new crypto ETPs in Europe providing directly backed exposure to LINK, UNI, and AAVE, the native tokens underpinning the Chainlink, Uniswap, and Aave networks.
The listings represent the first crypto ETPs to be launched in Europe in 2023.
The Global X Chainlink ETP (LI0X GY), Global X Uniswap ETP (UNIX GY), and Global X Aave ETP (AVMX GY) have been listed on Deutsche Börse Xetra in euros.
The ETPs are passported for sale in Austria, Denmark, Finland, Germany, Netherlands, Norway, and Sweden.
Each ETP provides 100% “physically” backed exposure to its underlying digital asset while maintaining the added oversight, security, and liquidity inherent in the ETP structure. The underlying crypto holdings are custodied by Coinbase Custody International.
Each ETP comes with an expense ratio of 0.99%, notably cheaper than rival products such as the VanEck Chainlink ETN and CoinShares Physical Chainlink, both of which are priced at 1.50%; the Valour Uniswap ETP, which has an expense ratio of 1.90%; and the 21Shares Aave ETP, which costs 2.50%.
The new listings represent the first digital asset ETPs to be introduced in Europe in 2023 after new product launches ground to a halt last year amid plummeting values in the crypto sector, a period that has become known as ‘crypto winter’.
Chainlink
Chainlink is a decentralized ‘oracle’ network – a blockchain abstraction layer that enables blockchains to interact with external data and systems through entities known as oracles.
Oracle networks have been instrumental in the evolution and proliferation of hybrid smart contracts which are smart contracts that combine blockchain-based code with off-chain oracles.
By also utilizing blockchain-based technology, oracles ensure the correct data is retrieved from a high-quality data provider, is verified, and then delivered onto the blockchain without manipulation from hackers.
LINK, which is used to pay oracles for their services, has a total market capitalization of $3.6bn, making it the 21st-largest crypto asset.
Uniswap
Uniswap is one of the largest decentralized cryptocurrency exchanges globally. Operating on the Ethereum blockchain, Uniswap uses smart contracts to facilitate automated transactions between any pair of Ethereum-compatible tokens.
Uniswap users may create liquidity pools of tokens they are willing to trade. Other users who then wish to trade with a liquidity pool enter into a smart contract that uses automated market-making technology to algorithmically determine the best execution price.
UNI is a governance token, allowing holders to vote on project developments, while the token may also be used to fund liquidity mining pools, grants, partnerships, and other growth-driven initiatives.
Although UNI serves as a governance token on the Uniswap platform, investors can also trade the token on exchanges and treat it as a speculative investment.
With a total market capitalization of $4.8bn, UNI is the 18th-largest crypto asset.
AAVE
Aave is a platform for borrowing and lending crypto assets. The platform uses smart contracts to automate the lending process with pre-set rules on how funds are distributed, collateral is handled, and fees are assessed.
Aave specializes in overcollateralized loans, a feature that protects lenders from losing money due to loan defaults and allows the Aave protocol to liquidate the collateral if it drops too much in value.
AAVE is used as collateral for taking loans and for paying loan fees. With a total market capitalization of $1.1bn, it is currently the 48th-largest crypto asset.