Mox Bank, a new cryptocurrency exchange based in Wyoming, launched a platform today that allows customers to trade bitcoin and ether exchange-traded funds (ETFs). The new platform enables users to buy and sell shares of ETFs that hold either bitcoin or ether, the two largest cryptocurrencies by market capitalization.
Cryptocurrency ETFs have been slow to gain regulatory approval in the U.S., though several companies have applications pending with the Securities and Exchange Commission. Mox Bank is able to offer the ETFs by partnering with a state-chartered bank in Wyoming that can provide custodial services for cryptocurrency assets.
Mox Bank’s CEO Tom Jessop said the new platform provides mainstream investors with a convenient way to get exposure to cryptocurrencies within their existing brokerage accounts. “Many people want to invest in cryptocurrencies but have found the process too complicated or risky,” Jessop said. “ETFs provide a familiar and regulated structure that mitigates some of the risks and complications of buying and holding cryptocurrencies directly.”
The bitcoin ETF will charge an annual fee of 1% and the ether ETF 1.5%. Mox Bank makes money by charging a small spread on the bid and ask prices of the ETFs. Jessop said additional cryptocurrency ETFs will be added to the platform if there is sufficient demand from customers.
The launch of the platform comes amid a modest rally in cryptocurrency markets, with bitcoin rising about 15% over the past month and ether up around 30%. While far below their all-time highs, the price increases have reignited interest in cryptocurrencies after a multi-year slump.
Some critics argue cryptocurrency ETFs go against the original decentralized vision of cryptocurrencies. But others counter that they provide more mainstream access and could boost adoption over the long run.
Mox Bank is not the first platform to offer cryptocurrency ETFs. Several offshore exchanges have listed similar products, though without U.S. regulatory approval. But Mox Bank is the first state-chartered U.S. bank to directly offer cryptocurrency ETF trading to customers.
The bank opened last year in Wyoming, which passed laws recognizing certain cryptocurrencies as legal forms of property and allowing crypto custody services. Mox Bank has partnered with crypto exchange Kraken to provide liquidity and trading infrastructure.
Wyoming Governor Mark Gordon praised Mox Bank’s new platform as an innovative new option for investors. “Wyoming remains at the forefront of blockchain and cryptocurrency innovation in the United States,” Gordon said. “Mox Bank’s new ETF platform is an exciting development that provides mainstream access to this new technology.”
Mox Bank’s ETF platform is now live and available to all U.S. customers, though certain states may have additional regulatory requirements. Jessop said the company plans to expand internationally but will do so carefully to ensure compliance with regulations in each new market.
