21Shares, a prominent issuer of cryptocurrency exchange-traded products (ETPs), is introducing a staking ETP centered on the cryptocurrency Toncoin (TON), enhancing investment opportunities in the digital asset realm. This new offering, named Toncoin Stake ETP, operates as a 100% physically-backed product, closely mirroring the performance of TON while reinvesting staking proceeds into the ETP to optimize returns.
Scheduled to commence trading on the SIX Swiss Exchange on March 27 under the ticker TONN, the Toncoin Stake ETP enables investors to earn TON staking rewards without the need to navigate the complexities associated with setting up and managing staking nodes. By harnessing the benefits of staking Toncoin through this ETP, investors gain access to the convenience and liquidity afforded by traditional financial markets.
TON, employing a proof-of-stake (PoS) model to achieve network consensus, offers validators the opportunity to earn rewards for staking, thereby contributing to network security. Typically, users require a substantial number of TON tokens, approximately 600,000 TON ($2.9 million), to participate in staking. However, pooling assets allows users to meet this requirement collectively.
Ophelia Snyder, co-founder and president of 21Shares, emphasized that TONN stands as the inaugural TON ETP to launch, providing investors with an avenue to capitalize on staking rewards. Snyder highlighted the superiority of staked ETPs over non-staking counterparts, as staking yields benefit ETP holders. She explained that non-collateralized ETPs forego a revenue stream paid in TON, potentially impacting investors' returns.
At the time of launch, the Toncoin Stake ETP boasted a value of $25 million, equivalent to approximately 5 million TON. This ETP, with an initial net asset value (NAV) of $20, offers investors a regulated and secure means to tap into the potential of the Open Network, which powers popular cryptocurrency-friendly messaging platforms like Telegram. Developed by Pavel Durov's Telegram, the Open Network aims to establish an extensive ecosystem of user-facing services, including decentralized storage, VPNs, payment solutions, and native wallets, enriching the user experience within the messaging app and other associated products.
Despite encountering legal challenges with the U.S. Securities and Exchange Commission in 2020, Telegram remains actively involved in promoting the open-source TON technology and Toncoin. As the cryptocurrency market experiences significant growth, TON has witnessed a surge of 134% over the past 30 days, indicating increasing investor interest in the asset's potential.
