CoinShares, a digital asset investment business, has announced the introduction of a new physically-backed exchange-traded product (ETP) monitoring the price of Cardano ($ADA). The ETP is meant to reward investors for taking the cryptocurrency.
CoinShares launches Physically-Backed Cardano ($ADA) ETP
The CoinShares Physical Staked Cardano ETP (CSDA), according to ETF Stream, is listed on the Deutsche Boerse with a total expense ratio of 1.5 percent, with the expenditures mitigated by the product’s staking incentives.
According to CoinShares’ website, the overall expense ratio has been cut to 0%, and investors may expect staking payouts of 3% each year. Each CSDA share is backed by one ADA token, and staking rewards are earned on a daily basis.
Staking allows investors to participate in Cardano’s consensus process and be compensated for it, much like miners on Proof-of-Efforts (PoW) blockchains are rewarded for their work on the chain.
CoinShares emphasizes that all staked coins are not transferred from the custodian and that the ETP is still 100 percent physically supported. According to PoolTool statistics, Cardano has 69.5 percent of its circulating supply staked over 2,993 active pools, implying that $18.3 billion of ADA is now staked.
The number has dropped by well over 70% late last year. Following the debut of decentralized apps on Cardano, which raised the demand for ADA, the percentage of circulating supply being staked is likely to have decreased.
According to CryptoGlobe, the number of addresses holding ADA for the long term increased by 32.1 percent last month to 408,000, following increasing by 10.9 percent in January and 5.78 percent in December, indicating that HODLers continue to accumulate the cryptocurrency.
According to CryptoCompare’s latest Asset Report, the number of addresses owning ADA increased by 5.9 percent in February to a new all-time high, owing mostly to an increase in long-term investors and a 13.4 percent increase in cruisers, which increased to 3.62 million addresses. The network’s trader count fell by 25.2 percent to 770,000.
CoinShares launched two more physically-backed ETPs tracking Tezos ($XTZ) and Polkadot ($DOT) last month. CoinShares was notable for releasing Europe’s first Bitcoin ETP in 2015, and it has subsequently created products that provide investors with exposure to other crypto assets. Products for Ethereum’s ether ($ETH), Litecoin ($LTC), and $XRP are among them.