While the U.S. is dragging its feet in approving a cryptocurrency exchange-traded fund, Canada, its near neighbor, is leading the way in cryptocurrency ETF adoption. Canada already has around 25 cryptocurrency ETF tickers trading on its Toronto Stock Exchange.
On Tuesday, another Canadian launched ETF was in the news as Accelerate Financial Technologies Inc. announced the launch of the world’s first carbon-negative Bitcoin ETF – Accelerate Carbon-Negative Bitcoin ETF (“ABTC”).
According to the firm’s official press release, the ETF seeks to provide investors with exposure to the performance of bitcoin by investing in derivatives that provide exposure to Bitcoin and intends to sequester over 100% of the estimated carbon dioxide emissions attributable to Bitcoin transactions that it is exposed to by funding decarbonization initiatives.
To do this, Accelerate plans to plant 3,450 trees for every $1 million CA ($788,200 US) invested in the Accelerate Carbon-Negative Bitcoin ETF (TSX:ABTC). The firm estimates that each batch of trees planted will sequester 1,000 tons of carbon dioxide.
Julian Klymochko, Founder and CEO of Accelerate, said the fund aims to tap into providing an investment vehicle that will allay environmental concerns that have been raised by investors over the high energy consumption of Bitcoin.
“Environmental, social and governance (“ESG”) concerns are top of mind for investors. From an ESG perspective, historically, bitcoin has had a mixed track record,” he said, adding “Accelerate changes this negative environmental outcome by offering a way to obtain exposure to bitcoin while benefiting the environment.”
So far, ETFs launched in Canada have had impressive runs on the stock exchange market. Both Ethereum and Bitcoin-backed ETFs have been trading well since the first one was approved in February this year. Of the twenty-five companies listed, the Ether Fund’s ETFs, QETH.UN and QETH.U, ranked 1 and 3rd in weekly trading volumes after surging 7.69% and 6.69% respectively, while 3iQ CoinShares Ether ETF (ETHQ) clocked in at second with a 6.77% increase in volume traded.
Notably, all the Ethereum based ETFs outperformed Bitcoin-based ETFs in the past week according to data from TMX Money. Purpose Bitcoin ETF (BTCC.B), which was the first ETF to be approved, clocked in at 19th position by trading volume after dropping 1.66% over the last week.
Furthermore, Canada is showing itself to be a territory for accelerated cryptocurrency adoption. The country, which has been noted to be a strong contender for dominance in Bitcoin mining, has all it takes to become just that. According to Canada Energy Regulator, in 2018, Quebec – a province of Canada – generated 213.7 TWh of electricity, of which 95% was fuelled by hydropower. This is enough power to supply the whole of the Bitcoin network, which uses about 129 TWh, with renewable energy.
Canada’s government is also exploring several use cases for blockchain technology. The final piece of the puzzle for cryptocurrency adoption to bloom in the country is more crypto-friendly regulations. With more friendly regulations for the sector, Canada is bound to leave the U.S. behind in the cryptocurrency innovation and adoption race.