HANetf, a $9.2 billion ETF provider, launched the Arrow Bitcoin EUR Hedged ETC (EBTC) on Sept. 29, marking the world's first euro-hedged Bitcoin Exchange Traded Commodity.
The new product mitigates U.S. dollar exposure for European institutional investors. Bitcoin's primary U.S. dollar pricing means these investors passively assume dollar risk when holding the asset.
Institutional allocation to Bitcoin is rising, driving demand for advanced risk management tools. Investors require precise control over their portfolio risk.
Tom Bailey, head of research at HANetf, said the Bitcoin market is reflecting changes already seen in gold. He said the gold market previously developed currency hedging products to meet investor needs.
Yusuf Fakhro, a partner at cryptocurrency service provider ARP Digital, offered a differing view on the hedging strategy. He said hedging from the U.S. dollar to the euro ultimately involves choosing between two fiat currencies.
Fakhro emphasized that both the U.S. dollar and the euro are subject to infinite issuance. This perspective highlights a fundamental difference in how some crypto participants view fiat currency against Bitcoin's fixed supply.
HANetf, a European ETF and ETC platform, provides euro exchange rate hedging for the product.
