The First European Bitcoin ETF Receives an ESG Label
Introduction
In a significant development for the cryptocurrency market, one of the first European Bitcoin exchange traded funds (ETFs) has been awarded an ESG label. Managed by Jacobi Asset Management, a financial institution specializing in providing digital asset management to institutional investors, this is the first time that the European Union’s ESG investment rules have been applied to an ETF allowing speculation on the value of Bitcoin.
What is an ESG Label?
An ESG label refers to criteria in the areas of Environmental, Social Responsibility, and Governance. This label helps investors identify funds or companies that meet certain sustainability standards.
Jacobi CEO Commits to Decarbonization
Martin Bednall, the CEO of Jacobi, has stated that the ETF will be fully decarbonized. The company plans to support enough renewable energy projects to offset the CO2 emissions from Bitcoin mining. The industry can greatly benefit from this commitment, as crypto mining is estimated to consume about 140 terawatt-hours per year, roughly equivalent to the energy consumption of Poland. Additionally, only 38% of the mining industry is sustainable.
The allocation of the ESG label has not been without criticism. Various environmental experts are concerned about the decision. Mathew Brander, an educator at the University of Edinburgh Business School, argues that the label does not represent the actual decarbonization or sustainable energy generated.
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The First Bitcoin ETF of its Kind
Jacobi Asset Management’s BTC spot ETF, also known as Jacobi FT Wilshire Bitcoin ETF and traded under the ticker BCOIN, was the first of its kind to be launched on the Euronext exchange in Amsterdam. This fund allows traditional investors to invest in Bitcoin without the need for separate crypto accounts or complex digital wallets.
Although European regulators approved it in 2021, the actual launch was delayed due to various market developments. Meanwhile, many eyes are on the US market, where approval for similar funds is still pending.
Tags: Bitcoin, BTC, ETF, Jacobi