Digital asset investment firm CoinShares has announced the launch of a new physically-backed exchange-traded product (ETP) tracking the price of Cardano ($ADA), The ETP is designed to share the rewards of staking the cryptocurrency with investors.
As reported by ETF Stream, the CoinShares Physical Staked Cardano ETP (CSDA) is listed on the Deutsche Boerse with a total expense ratio of 1.5%, with the expenses being offset by the product’s staking rewards.
CoinShares’ website shows that the total expense ratio has been reduced to 0% and that investors can expect staking rewards of 3% a year. Each CSDA share is backed by 1 ADA token and the staking rewards are accrued daily.
Staking allows investors to participate in Cardano’s consensus mechanism and get rewarded for it, in a way similar to the one miners in Proof-of-Work (PoW) blockchains are rewarded for their work on the chain.
CoinShares notes that all staked coins do not move from the custodian and that the ETP remains 100% physically backed. According to data from PoolTool, Cardano currently has 69.5% of its circulating supply being staked across 2,993 active pools, meaning $18.3 billion of ADA are currently staked.
The figure is down from well over 70% late last year. The percentage of ADA’s circulating supply being staked likely dropped after the launch of decentralized applications on Cardano, which increased demand for ADA.
As CryptoGlobe reported, the number of addresses holding ADA for the long-term has grown by 32.1% last month to 408,000, after growing by 10.9% in January and 5.78% in December, suggesting HODLers keep on accumulating the cryptocurrency.
According to CryptoCompare’s latest Asset Report, the number of addresses holding ADA grew 5.9% to a new all-time high in February largely thanks to a rise in long-term holders and a 13.4% rise in cruisers, which went up to 3.62 million addresses. The number of traders on the network dropped 25.2% to 770,000.
Last month, CoinShares launches two other physically-backed ETPs tracking Tezos ($XTZ) and Polkadot ($DOT). CoinShares notably launched Europe’s first Bitcoin ETP in 2015, and has since been launching products that offer investors exposure to other cryptoassets. These include products for Ethereum’s ether ($ETH), Litecoin ($LTC), and $XRP.
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