The Singapore headquartered Huobi has announced the debut of the crypto-based exchange-traded fund (ETF) HB10. This means retail traders will now be able to trade in various assets portfolios instead of trading in just one asset at a time.
“Retail traders have been used to the various investment options that accept transactions both in cryptocurrencies and in fiat money, but this investment instrument only accepts cryptocurrencies”. The company confirmed when it announced its crypto-based exchange-traded instrument called HB10 on Friday.
Founded by Leon Li way back in September 2013, Huobi is focusing on the Chinese market and the Chinese retail investors. Despite focusing on this niche, the HB10 subscription is open to all investors across all blockchain powered investment networks. As reported earlier, the index reflects the overall performance on Huobi Pro using weighted samples.
According to the firm’s recent report, the foreign traders can also register and trade on the HB10. Registration can be done through the verification process on the Huobi website. Essential parameters to trade include personal information, email address and verification of the user’s real name.
In an attempt to disclaim the remarks, one of the company representatives told CoinDesk that the new product would have similar restrictions like the Huobi Pro despite being open for subscriptions. The new instrument excludes investors from the U.S. due to the hindrance from U.S. Securities and Exchange Commission (SEC) security concerns.
“Because of regulatory uncertainties this new offer is available to investors based in China only”. The representative remarked.
Huobi 10 index
Reports from the firm indicate that HB10 was invented to replicate the Huobi 10 index. The Huobi 10 index was used to track 10 assets in real time. The 10 assets were invested in a portfolio and tested for their liquidity and market capitalization on the Huobi Pro exchange.
Diversification of risks
As reported earlier, HB10 is expected to reduce investors’ exposure to risks of trading various cryptocurrency assets through diversification. This optimism is based on the Huobi Pro indication of market performance using weighted samples and data tracking.
As they announced the launch of the HB10 investment instruments, the company has also invited institutional investors to partake on the feasibility of the trade instrument.
“Because we are dealing with a portfolio of investment in various cryptocurrencies, the impact of institutional entry and exit on single cryptocurrencies will be eradicated”.
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