Following approval from the relevant authorities, investors in the UK can once again invest in cryptocurrency exchange-traded notes (ETNs) through a tax-free vehicle, thanks to fintech startup Stratiphy. According to a report by the Financial Times, Stratiphy will provide access to three ETNs from 21Shares, including those tracking bitcoin, ether, and a combination of BTC and gold, all within a special class of individual savings account (ISA). This development allows UK investors to hold these crypto ETNs in a tax-efficient manner, as ISAs enable users to save up to £20,000 per year without incurring income tax or capital gains tax on the returns.
The move comes after the UK's tax authority, HMRC, reclassified crypto ETNs as eligible for Innovative Finance ISAs (IFISAs) from the start of the current tax year. Stratiphy, which manages £4 million for 2,000 clients, will offer these ETNs alongside IFISAs, providing a unique opportunity for investors to diversify their portfolios with a new asset class that has a low correlation to other asset classes.