European cryptocurrency manager Coinshare is preparing to go public in the US and will make another strategic acquisition.
Coinshares announced Wednesday that it will acquire London-based Crypto Investment Manager Bastion Asset Management as part of its expansion strategy in the US.
The transaction is pending approval from the UK Financial Conduct Office, so Coinshares will fully integrate Bastion’s trading capabilities, strategy and team into the platform. The terms of the transaction have not been disclosed.
“By combining Bastion’s systematic trading expertise with the 1940 legal registration, we can go beyond the simple exposure to cryptocurrency and develop aggressively managed products for the US market.”
Active and Passive ETFs
Unlike passive exchange trade funds (ETFs), which track indexes or assets, active ETFs rely on managers to select investments in attempts to outperform the market.
“Most US crypto asset managers focus solely on passive products that simply track cryptocurrency prices,” a Coinshares spokesman said highlighting the growing institutional demand for more sophisticated investment solutions.
Because Coinshares holds the status of registered investment advisor under the US Investment Corporations Act of 1940, the company is permitted to provide aggressively managed investment products in the United States, including sophisticated strategies such as aggressively managed ETFs.
However, creating these products requires deep quantitative expertise and proven, systematic trading capabilities, and we hope that Coinshares will get it from Bastion.
Related: What does ETF approval shortcuts mean for cryptography?
“The Bastion team has over 17 years of experience developing systematic, alpha-generating strategies with major hedge funds such as Bluecrest Capital, Sestematica Investments, Rokos Capital and Gam Sestematic,” Coinshares told Cointelegraph.
“Quantitative approaches using academically supported signals to generate market orientation-independent returns are a type of sophisticated, positively managed strategies that distinguish managers in highly competitive markets.”
Rising Active ETFs
Despite the surge in the crypto ETF market, the industry is heavily dominated by passive ETFs such as Spot Bitcoin (BTC) and Ether (ETH) funds, reflecting the domination of passive funds in traditional finance.
This trend has doubled over the past five years and began to change in July, when the number of active crypto ETFs, which shows a change in market dynamics, surpassed index tracking funds.
“Coinshare offers both products and strategies in a direction designed to generate alpha regardless of market conditions,” the spokesman said.
Coinshares US Push
Coinshares’ expansion of its US investment products shows an ongoing market driving force, with the company planning to go public through a special purpose acquisition company with a $1.2 billion primoney equity rating.
“This list of US exchanges provides deeper access to US capital markets and can significantly improve visibility with American institutional investors,” Coinshares told Cointelegraph, adding:
“The US is the deepest capital market in the world of digital assets, building infrastructure, teams and product suites and becoming a leading institutional player in that market.”
The news came shortly after the Securities and Exchange Commission approved a proposal to change the rules that would allow stock exchanges to adopt general listing standards for new crypto funds.
According to an online report, the new process reduces the maximum time between filing and launch from 240 days to 75 days.
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