VanEck, a cryptocurrency ETN investment management firm that operates from New York, is looking to extend its catalog of services for its customers by including Avalanche and Polygon ETNs in its new comprehensive upgrade.
The firm has announced plans to expand its offerings to accommodate crypto tokens Avalanche(AVAX) and Polygon(MATIC). The new feature will enable their investors to trade with leveraged AVAX and MATIC tokens without purchasing them.
What are ETNs?
ETNs stands for Exchange Traded Note. It essentially means that they are a structured set that is dispensed as debt notes to investors by a traditional financial institution, primarily banks. They are debt securities backed by the issuer’s funds, meaning that the investors are subject to the issuer’s credit risk.
In the traditional sense, they are primarily developed to trade on stock exchanges and return a profit on traded market setups.
ETNs differ from ETFs in the sense that, unlike ETNs, which trade virtually as a form of the market standard, ETFs stand for an investor’s stake in a particular commodity. It provides investments into a fund that holds the entity it tracks, such as stocks, bonds, gold, etc.
AVAX And MATIC As ETNs
In VanEck’s option that will allow AVAX and MATIC to be traded as ETNs, the firm has revealed that the two cryptocurrency tokens are insured securely, and investors are liable to negligible credit risk upon utility.
Further analysis by the investment company assured its investing public that the ETNs it will provide is fully pegged to various cryptocurrency exchange platforms and stored in offline storage (wallets). The storage utilized is regulated by insured crypto storage firms in the community’s local space.
VanEck And Regulations In The Us
The investment firm has had more than one confrontation with financial regulators in the United States. In November, earlier this year, the US’s SEC previously rejected a proposal by VanEck to list Bitcoin ETFs in its service offers.
Months after an initial rejection, the SEC approved VanEck’s cryptocurrency derivatives service, Bitcoin futures-based fund.
State Of Affairs Of Cryptocurrency In The US
The United States is the bedrock for trans-era development as featured in the development of cryptocurrency. The country in the past has been the home and source of era warping innovations globally.
The situation has been the case for decades now. Still, the title might change owners in the coming decade due to the country’s slow adaptation of relevant regulations in the cryptocurrency sector of its economy.
The growth of cryptocurrency globally was primarily linked to the United States. But the tech, a dynamic innovation, has since started to diffuse to other parts of the world that are more friendly to its development.
The lack of fair regulations and government support has hampered the industry’s growth in the country. Americans cannot access opportunities and quality innovations that the technology affords due to these reasons.
Recently, lawmakers and various experts in the industry have realized the latent danger the country’s perceived nonchalance affords. Given this, the nation has started regulating cryptocurrency properly and keeping up with the times.