What Is A Crypto ETN And How Do I Invest?

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UK retail investors – that’s you and me – can buy crypto Exchange Traded Notes (cETNs) from October 2025 after the Financial Conduct Authority lifted a ban on their sale.

You may already be familiar with more traditional Exchange Traded Funds (ETFs), but what exactly are crypto ETNs and how can you buy them? This is what I’ll explore in this blog post.

What is a crypto ETN?

A crypto ETN is an unsecured debt instrument issued by financial institutions and designed to track the price of an underlying asset or basket of assets. In the case of cETNs, this means cryptocurrencies such as Bitcoin or Ethereum.

Unlike ETFs which own the underlying asset or basket of assets they consist of, cETNs don’t give investors direct ownership of the underlying cryptocurrencies. However, they function in a similar way to stocks and can be traded on stock exchanges.

However, unlike other debt instruments, such as bonds, cETNs do not make interest payments. Instead, investors will profit only if the value of the underlying cryptocurrencies has increased when they sell their cETN portfolio.

One of the major advantages of a cETN is that it removes the need for investors to overcome the technical hurdles involved in buying cryptocurrencies themselves, storing them securely and managing private keys.

How do I buy crypto ETNs in the UK?

Individual investors can buy cETNs through FCA-approved exchanges, such as the London Stock Exchange and Cboe UK.

People will be able to access the cETNs through traditional brokerage accounts, including those that offer Stocks & Shares ISAs and Self-Invested Personal Pensions (SIPPs).

The list of brokers who offer cETNs currently includes Hargreaves Lansdown, eToro and Interactive Investor. More are expected to follow.

What are the risks of cETNs?

All investments come with a certain degree of risk and the same can be said for cETNs. Here’s a summary of the main considerations:

• Volatility – Cryptocurrencies experience significant price swings and cETNs will reflect these movements, meaning you could lose a significant amount of your investment in a short space of time.
• No protection – Unlike other financial products, the Financial Services Compensation Scheme (FSCS) does not cover cETNs, meaning investors bear the full financial risk of poor performance or issuer failure.
• Counterparty risk – cETNs carry the risk of issuer default. If the institution issuing the cETN fails, investors could lose all their money.

Can my financial adviser offer cETNs?

Independent financial advisers (IFAs) can offer advice on cETNs as they fall under regulated investment activities, although advisers need to ensure they understand the product and have the necessary permissions.

Even if you buy a cETN through an IFA, or on their recommendation, your investment will not be covered by the FSCS.

Final Word

The FCA’s decision marks a watershed moment for the UK’s digital asset market.

Allowing retail investors access to cETNs potentially opens up the crypto market to a huge, untapped pool of investment cash from those who would otherwise be averse to adding Bitcoin to their portfolios due to the complexities of individual ownership.

It’s likely that IFAs will warm to crypto as well now that they have a regulated product to offer clients, especially as a more tech savvy generation is starting to seek advice on digital assets.