Frequently Asked Questions (FAQ)

Investing in Virtune's ETPs offers several distinct advantages for you as an investor:

Simple and Secure: You avoid the complexity of creating and managing a digital wallet, as well as the challenges of selecting a secure crypto exchange for trading. All aspects of security and storage are handled by us.

Tax Efficiency: Investing in our ETPs can be associated with tax benefits. In Sweden it is possible to invest in our ETPs through an Investment Savings Account (ISK) or a Capital Insurance means you do not need to declare individual transactions. Instead of a 30% capital gains tax on direct crypto trading, you pay an annual fixed tax, which can provide significant tax benefits.

Regulated Trading Venue: Our products are traded on Nasdaq, a regulated and secure marketplace, adding an additional layer of safety and reliability to your investment.

Physically Backed Products: All our ETPs are 100% physically backed, meaning that actual crypto assets are stored corresponding to the market value of each ETP, ensuring transparency and trust.

Staking Opportunities: Some of our products also offer staking, which is managed by us and provides extra returns without any effort required from you.

Virtune is a Swedish company based in Stockholm, registered as a financial institution with the Financial Supervisory Authority, with an EU-approved base prospectus for the market listing of crypto ETPs. We strive to be the safe choice for your crypto investments.

Virtune's ETPs are always 100% backed by equivalent crypto assets stored in cold storage at Virtune's Nasdaq-approved custodian. The underlying crypto assets determine the price of the ETPs. Price movements are always based on a 1:1 correlation to the underlying crypto assets.

All of Virtune's ETPs are always 100% physically backed, this means that we store the equivalent value of all outstanding securities in the underlying crypto asset with our custodian in cold-storage (offline). The equivalent value of each ETP in the underlying cryptocurrency asset is received and stored separately with our custodian Coinbase before new ETPs are created.

Our products are priced through a so-called coin entitlement to the underlying crypto assets, which means that 1 ETP represents a certain amount of crypto assets. This structure ensures a 1:1 exposure to the underlying crypto asset with the highest possible investor protection and minimized credit risk towards the issuer (Virtune) of the ETPs.

Our products are listed on stock exchanges which includes Nasdaq Stockholm, Nasdaq Helsinki, Euronext Amsterdam, Euronext Paris and Boerse Stuttgart and can be traded through several online brokers and banks. Our products are currently accessible for retail investors in the countries listed below and through several banks and brokers including the ones listed below:

Sweden
Avanza
Nordnet
Handelsbanken
Pareto Securities
Strivo

Finland
Nordnet

Norway
Nordnet
DnB

Denmark
Nordnet

Germany
Comdirect

Netherlands
Degiro

We are continuously working to expand the availability of trading our products on more exchanges and platforms. If our products are missing on your platform, contact them and ask if the products are available for trading and please contact us with your request to add our products to your platform.

Our products are priced based on a 1:1 correlation with the performance of the underlying crypto asset, minus a management fee and, for our staking ETPs, plus staking rewards. They are priced through what we refer to as 'coin entitlement' to the underlying crypto assets, meaning that one ETP represents a specific quantity of crypto assets stored with our custodian. For our staking ETPs, staking rewards are continuously added, contributing to an increase in the amount of crypto assets per ETP over time. You can track the daily amount of crypto assets per ETP on each product page. Each crypto asset is priced according to regulated and established crypto asset reference rates.

Our ETPs are always 100% backed by the underlying crypto assets, meaning they provide a 1:1 exposure to these assets, adjusted for the annual management fee and any staking rewards. Our products are traded only during the opening hours of the respective exchanges, such as Nasdaq Stockholm (09:00–17:25, Monday to Friday), which is why the value development is reflected only when the relevant exchange opens.

If the price of an underlying crypto asset, such as Bitcoin, changes outside of the exchange's opening hours, this change will be reflected in the product's price when the exchange reopens.

All of Virtune's ETPs are 100% physically backed by the underlying crypto assets (asset-backed securities), which means that we store the equivalent value of all outstanding securities in the underlying crypto asset with our custodian in cold storage (offline). This reduces the credit risk to Virtune as the issuer and is a safer option for investors compared to investing in tracker certificates that provide synthetic exposure and do not hold the underlying crypto assets as collateral. In such cases, you could theoretically lose your entire investment if an issuer of synthetic tracker certificates goes bankrupt. This is not the case with Virtune's products, as the crypto assets stored separately with Virtune's custodian serve as underlying collateral, protecting your investment in Virtune's ETPs.

The product follows a rule-based investment strategy and is rebalanced on a monthly basis. The allocation of crypto asset is value-weighted based on each crypto asset's market capitalization, with a maximum weight of 40% for each crypto asset to promote diversification. Since the product is listed on Nasdaq, only crypto assets that are part of the Nasdaq Crypto Index Europe may be included.

The Virtune Crypto Top 10 Index ETP follows an index with a rule-based investment strategy (Virtune Vinter Crypto Top 10 index) that includes up to the top 10 crypto assets based on market capitalization. Additional criteria are then applied for each crypto asset, such as not being a stablecoin (a crypto asset whose value is always intended to be the same as a fiat currency, typically the US dollar). The product is listed on Nasdaq Stockholm, which means we also need to adhere to the crypto assets included in Nasdaq Crypto Index Europe. In summary, this means that crypto assets need to meet the criteria of two indexes to be included in the product.

You can find fact sheets and additional information about each ETP on the product pages of our website. Additionally, KIDs are available on platforms such as www.avanza.se and www.nordnet.se.

The crypto assets are always stored separately at an external custodian institution in cold storage (offline). We have chosen to include a security agent whose purpose is to protect and represent the investors in our ETPs. In the unlikely event that Virtune becomes insolvent or goes bankrupt, our security agent would take control of the crypto assets, sell these assets, and then redeem all ETPs, paying out the corresponding amount minus fees in SEK or EUR to all ETP holders.

Virtune is a regulated crypto asset manager that offers crypto Exchange Traded Products (ETPs). We are registered as a financial institution with the Swedish Financial Supervisory Authority (Finansinspektionen) and serve as the issuer of crypto ETPs with an EU-approved base prospectus. We are a dedicated and passionate team of professionals that are strong believers in blockchain technology and crypto assets, committed to harnessing its potential to benefit the world. Our mission is to accelerate crypto adoption across Europe for institutional and retail investors, educate the market, and uphold the highest standards of transparency.
Our mission is to lower the barriers to entry into the crypto market by providing a easy, secure and regulated way for investors to gain exposure to crypto.

Virtune was founded in 2022 and our headquarters is located at Kungsgatan 26 in Stockholm, Sweden. We are a Stockholm-based and Swedish-owned company.

Virtune is a registered financial institution with the Swedish Financial Supervisory Authority and holds an EU-approved base prospectus for issuing crypto ETPs across Europe. This registration subjects us to regulatory oversight in multiple areas. We adhere to strict compliance and risk management procedures to ensure the highest level of security for our investors' assets.

Staking enables crypto asset owners to earn passive income by participating in the validation and confirmation of transactions on a blockchain through a process known as Proof of Stake. This mechanism is a fundamental component of Proof of Stake blockchains, like Ethereum and Solana, and plays a vital role in ensuring the security and authenticity of blockchain transactions. To facilitate a transaction on the blockchain securely and accurately, a validator must stake a certain amount of crypto asset as a guarantee of the transaction's legitimacy. The validator aims to stake as much crypto assets as possible to increase the likelihood of receiving rewards, which are paid out in the same type of crypto asset that was staked. For instance, if you stake Ethereum, you receive additional Ethereum as a reward. The annual reward percentage for staking can vary and may range from 0-14% or higher for some blockchains. Most crypto asset holders cannot act as validators themselves, as it requires significant amounts of crypto assets. Therefore, many choose to stake their assets through an established and trusted validator. Virtune includes staking rewards in its products that have 'staking' included in their names.

Staking enables investors to earn additional returns on a crypto asset beyond its potential value growth. This is achieved by contributing to the blockchain through transaction validation, a core function of crypto asset blockchains that utilize Proof of Stake. Staking a crypto asset also helps avoid dilution caused by inflation in the blockchain network. The annual reward rate varies between different crypto assets, typically ranging from 2% to 14%. Virtune offers a fixed annual staking yield of 2-4% for our staked Solana, Polkadot, Cardano, and Polygon ETPs. In Virtune Staked Ethereum ETP, the annual staking yield varies where 75% of the annual staking rewards are returned to investors, potentially increasing the Net Asset Value (NAV) over time through these rewards. The remaining 25% is allocated to the custodian, staking provider, and Virtune for managing and maintaining the staking operations of the ETP. The additional return from staking rewards is reflected in the daily NAV of Virtune's staked ETPs.

There are two main risks associated with staking: lockup periods and slashing.

Lockup periods in staking refer to a timeframe during which staked crypto assets are locked and cannot be readily moved or sold. This is similar to an interest savings account where your assets are tied up for a specific period. The length of the lockup period can vary, ranging from 0 to 28 days, depending on the specific staking protocol or platform. During this period, you won't have immediate access to your staked crypto assets, meaning you cannot quickly sell or move your investment, even if market conditions are unfavorable. To mitigate this risk, Virtune diligently monitors and analyzes the market to ensure that the staked portion of Virtune's staked ETPs (Exchange Traded Products) maintains adequate liquidity, allowing the ETP to be traded normally at all times.

Slashing is a penalty imposed on crypto assets that are staked with a validator, which can affect the staked funds. This penalty is incurred when a validator engages in actions such as validating incorrect transactions or going offline. The specific reasons and conditions for slashing vary across different crypto assets and blockchain networks. Generally, the penalty involves a reduction of a small percentage of the staked assets. It is important to note that the exact percentage and consequences of slashing can vary depending on the protocol. When engaging in staking, it is crucial to choose a trustworthy and reputable validator. Virtune takes this seriously and exclusively selects established, regulated, and leading staking providers to ensure minimal risk. We ensure minimal slashing risk by partnering with reputable and regulated staking providers such as Coinbase and Figment.

Slashing is a penalty imposed on crypto assets that are staked with a validator, which can affect the staked funds. This penalty is incurred when a validator engages in actions such as validating incorrect transactions or going offline. The specific reasons and conditions for slashing vary across different crypto assets and blockchain networks. Generally, the penalty involves a reduction of a small percentage of the staked assets. It is important to note that the exact percentage and consequences of slashing can vary depending on the protocol. When engaging in staking, it is crucial to choose a trustworthy and reputable validator. Virtune takes this seriously and exclusively selects established, regulated, and leading staking providers to ensure minimal risk. We ensure minimal slashing risk by partnering with reputable and regulated staking providers such as Coinbase and Figment.

No, we never lend or send crypto assets to any third party. We exclusively utilize non-custodial staking, which means all staking is done directly from cold storage (offline) at our custodian.

Virtune exclusively uses non-custodial staking. This approach ensures that crypto assets being staked remain securely stored in cold-storage (offline) within our custodian, minimizing theft risks and eliminating reliance on third-party services. The staking process is conducted directly from digital wallets, enhancing security and control. All crypto assets staked by Virtune are consistently kept in cold storage, which is widely recognized as one of the safest methods for crypto assets storage.

Conversely, custodial staking involves users transferring their crypto assets to another entity for staking purposes. This method carries risks such as potential theft, since the crypto assets are managed and stored by someone else. For these reasons, along with regulatory considerations, Virtune does not engage in custodial staking.

No, staking is only applicable to crypto assets that rely on the Proof of Stake consensus mechanism. For example, Ethereum, the second-largest crypto asset, underwent a transition from Proof of Work to Proof of Stake in April 2023, allowing it to be staked. However, Bitcoin, the largest crypto asset, utilizes the proof of work mechanism, where new Bitcoin are generated through mining. As a result, Bitcoin cannot be staked. Staking is specific to crypto assets that have implemented and support the Proof of Stake model.

What is the difference between Proof of Work and Proof of Stake? Proof of Work and Proof of Stake are two different consensus mechanisms used in blockchain networks to achieve consensus and validate transactions. Proof of Work requires miners to solve complex mathematical problems using computational power, consuming significant energy. Proof of Stake selects validators based on their coin holdings and stakes, being more energy-efficient. Both systems aim to achieve consensus but differ in resource usage and security mechanisms.

Staking rewards are continuously added to our staked ETPs, increasing the coin entitlement, which means the amount of crypto assets per ETP grows over time. This results in additional returns from staking being reflected in the daily price and Net Asset Value (NAV) of the product.

Staking rewards for Proof of Stake crypto assets continuously fluctuate and can be tracked on websites like stakingrewards.com. These rewards vary based on the proportion of all staked crypto assets and other factors. Virtune offers a fixed annual staking yield of 2-4% for our staked Solana, Polkadot, Cardano, and Polygon ETPs. In Virtune Staked Ethereum ETP, we stake up to 70% of our ETH holdings and guarantee that at least 75% of these rewards are reinvested in the product and returned to investors.

Yes, all our staked products can be freely traded on the market without any lock up period. This is made possible by employing a flexible staking strategy where a portion of the holdings, which varies from 40%-80%, is actively staked, while the remaining part is kept unstaked. This strategy ensures that the products remain liquid and available for trading, while also allowing investors to benefit from the additional returns that staking offers.