JPMorgan to Launch ‘Crypto Exposure Basket’ Featuring Crypto-Linked Public Listed Companies

One of America’s leading banking institutions JPMorgan is all set to issue debt that links to public listed companies focused on cryptocurrencies. In its recent regulatory filing submitted to the U.S. SEC, the Wall Street banking giant aims to launch a ‘crypto exposure basket’ allowing investors to expand to crypto market without directly investing in cryptocurrencies.

The basket basically represents some of the public listed companies which have invested in cryptocurrencies. This includes 11 reference stocks in total with some of the well-known names like MicroStrategy, PayPal, Square, and Riot Blockchain.

Besides, it also includes stocks of companies involved in crypto mining activities as well as companies offering crypto investment products. Thus, it includes names like Taiwan Semiconductor Company, Micro Devices, Intercontinental Exchange, Silvergate Capital, CME Group, and others.

In its filing with the SEC, JPMorgan stresses that its ‘crypto exposure basket’ is not directly tied to any particular cryptocurrency. The filing states: "The notes are designed for investors who seek exposure to the performance of the J.P. Morgan Cryptocurrency Exposure Basket (Mar 2021) of unequally weighted Reference Stocks, which we refer to as the Basket, as reduced by the Basket Deduction of 3.00%. Notwithstanding the name of the Basket, the notes do not provide direct exposure to cryptocurrencies and the performance of the Basket may not be correlated with the price of any particular cryptocurrency, such as bitcoin.”

With banking giants launching such products, it is clear that demand for such structured crypto products is increasing. In another interesting development, digital asset management firm Grayscale is looking to launch its own Bitcoin exchange-traded-fund (ETF) as per its new job postings.

All of the recent job postings by Grayscale refer to the company’s new ETF business. However, Grayscale doesn’t have any of the ETF products as of now. Grayscale has a number of cryptocurrency trusts under its offering.

The Grayscale Bitcoin Trust (GBTC) is its biggest and primary product offering and also the biggest Bitcoin fund currently available in the market. The job posting from Grayscale notes that candidates for the required position should have “Experience in interacting with FINRA, SEC, NYSE, NYSE ARCA, CBOE, and/or other securities exchanges, either directly or in collaboration with Compliance and Legal staff”.