VanEck, a New York-based asset manager, is expanding its crypto offering with two new ETNs on Avalanche and Polygon.
VanEck adds Polygon & Avalanche
The ETNs allow investors to gain exposure to Avalanche (AVAX) and Polygon (MATIC) prices without having to buy the cryptocurrencies directly. Both ETNs are fully collateralized, and each ETN share represents one share of Polygon or Avalanche. The ETNs are also 100% backed by the crypto platforms and are stored in cold storage at a regulated crypto custodian with crypto insurance.
With this, Polygon and Avalanche join Bitcoin, Ethereum, Polkadot, Solana, and Tron in the list of ETNs offered by the company. VanEck also notes that ETNs, like ETFs, can be traded on regulated exchanges.
VanEck expands its #crypto investment offering with two new ETNs on crypto platforms #Avalanche and #Polygon. More information on https://t.co/mO3qOHWBGX and https://t.co/IUf67GSBUV. pic.twitter.com/lkzHgza813
— VanEck Europe (@vaneck_eu) December 16, 2021
What is an ETN?
Exchange-traded notes (ETNs) are similar to exchange-traded funds in that they trade on an exchange and track a benchmark index. The main difference is that an ETN is a senior, unsecured debt security issued by a bank – unlike an ETF, which holds assets that form the basis of the ETF’s price. In November, the U.S. Securities and Exchange Commission rejected a proposal to approve a spot Bitcoin exchange-traded spot fund (ETF) from VanEck, only to later approve VanEck’s Bitcoin futures-based fund.
Avalanche serves as a platform for developing decentralized apps (dApps) and custom blockchains and is a competitor to Ethereum. Polygon, on the other hand, is a so-called Layer 2 network. Polygon offers Ethereum scalability and interoperability with other blockchains.