The UK 2023 Financial Services Act instructed the Financial Conduct Authority (FCA) to come up with a framework that allowed investors to buy crypto in a safe way.
The FCA has been negotiating with the London Stock Exchange and have agreed a set of rules.
Cryto Exchange Traded Notes (ETNS) must by physically backed with coins and must be non-leveraged.
They must be backed by Bitcoin or Ethereum and the market price of the ETN must be the value of the underlying assets.
The coins must be stored in a cold wallet or "something similar".
The cold wallet must be held by a custodian subject to Anti-Money Laundering laws in the United Kingdom, the European Union, Switzerland or the United States.
The London Stock Exchange says it will accept applications to list Bitcoin or Ether ETNs that meet the above criteria in the second quarter of 2024 (the quarter beginning in April).