Why the Performance of Your Crypto ETP May Differ from the Underlying Cryptocurrency

Why the Performance of Your Crypto ETP May Differ from the Underlying Cryptocurrency

Many investors who track the price movements of cryptocurrencies like Bitcoin sometimes wonder why their investment in a crypto ETP hasn't developed in exactly the same way as the asset itself. The most common reason for this discrepancy is the exchange rate between the US dollar (USD) and the Swedish krona (SEK), but there are other contributing factors as well.

Crypto ETPs with 1:1 Exposure – But Priced in SEK

Virtune’s crypto ETPs are designed to provide 1:1 exposure to the underlying cryptocurrency, such as Bitcoin. Each ETP represents a certain amount of the underlying asset, which is securely stored in cold storage at our custodian, Coinbase. The ETP price reflects the current market value of the asset – but in Swedish kronor.

Since cryptocurrencies like Bitcoin are almost exclusively traded in USD, this means that you as an investor are also exposed to fluctuations in the exchange rate between USD and SEK.

Example: How Exchange Rates Affect Your Investment

This can be clarified with a hypothetical scenario:

Assume that the price of Bitcoin remains stable at 60,000 USD.
If the exchange rate shifts from 11.00 SEK/USD to 10.00 SEK/USD, the dollar has become cheaper relative to the krona.

Result:
A bitcoin that was previously worth 660,000 SEK (60,000 × 11) is now worth 600,000 SEK (60,000 × 10).
Even though the price of Bitcoin in USD remains unchanged, the value of your investment in SEK has dropped by 9%, solely due to the currency movement. Your crypto ETP, which is priced in SEK, reflects this directly.

Currency Effects Can Go Both Ways

Currency fluctuations can either benefit or harm your investment:

• If the dollar strengthens against the krona: the ETP value in SEK increases.

  
  

• If the dollar weakens against the krona: the ETP value in SEK decreases.

  
  

In 2025, USD/SEK has gone from around 11.20 to 9.60 – a drop of over 15%. Even if the underlying crypto asset has risen or stayed the same in USD terms, the value of your ETP in SEK can still decrease – solely because the dollar has weakened against the krona.

Other Factors That Affect Your ETP’s Performance

Beyond currency impact, several other factors can contribute to your crypto ETP not exactly mirroring the performance of the underlying asset. Here are some key aspects to keep in mind:

1. Limited Trading Hours on the Exchange

Virtune’s ETPs are traded during Nasdaq Stockholm's open hours, Monday to Friday between 09:00 and 17:25. The crypto market, however, is open 24/7. This means that price movements of the crypto assets outside the exchange’s trading hours will be reflected at the next market opening.

2. Management Fee Affects Value Over Time

All Virtune ETPs have an annual management fee that is applied continuously through a daily adjustment. This is done by gradually reducing the amount of underlying crypto per ETP, which affects the investment’s value over time. In our staked ETPs, staking provides an opposite effect, where the amount of crypto per ETP can increase over time due to staking rewards.

3. Price Differences Between Crypto Exchanges

There is no universal global price reference for crypto assets. Prices can therefore vary slightly between exchanges such as Coinbase, Binance, or Kraken. Since Virtune’s products are based on pricing from specific exchanges, these variations can contribute to differences compared to other sources.

4. Brokerage Fees on Buy/Sell

When trading via an online broker like Avanza, a brokerage fee is usually added for each buy or sell order. This fee impacts your actual return – especially for smaller transactions, where the fee represents a larger portion of the invested amount.

5. Bid-Ask Spread

Like other exchange-traded instruments, ETPs are traded with a certain spread – that is, the difference between the buy and sell price. This spread serves as compensation to the market makers who ensure liquidity, allowing you to buy and sell at any time. During periods of high volatility, the spread may temporarily widen, which can affect both your buy and sell price.

Transparency and Security in Your Investment

All our crypto ETPs are 100% physically backed, and the holdings are stored in cold storage with our custodian, Coinbase. On our product pages, you can see exactly how much of the asset each ETP represents and track the holdings day by day.

Need help understanding how your investment has been affected?
Feel free to contact us at hello@virtune.com – we’re happy to assist you.

Crypto investments are associated with high risk. Virtune does not provide investment advice. Investments are made at your own risk. Securities may increase or decrease in value, and there is no guarantee that you will recover your invested capital. Please read the prospectus, KID, terms at www.virtune.com.