The Financial Times has disclosed that Jupiter Asset Management, a prominent London-based investment company overseeing more than $65.8 billion in assets, has halted a multimillion-dollar investment in a crypto-related product due to stringent regulatory standards in Ireland. The firm had to cancel its involvement in 21Shares’ Ripple XRP exchange-traded product (ETP) despite having allocated $2.58 million to the venture during the early half of 2023.
Jupiter’s Investment Obstructed by Regulatory Compliance
Jupiter’s gold and silver fund, the primary investor in the ETP, faced a setback when routine compliance checks uncovered a regulatory issue, leading to the investment’s discontinuation. Sources claim that this reversal incurred a minor loss of $834 for Jupiter Asset Management.
Disparate European Regulations Create Investment Hurdles
A significant factor in the cancellation was the divergent cryptocurrency regulations within Europe. Ireland’s stringent rules surrounding UCITS funds prevent the inclusion of cryptocurrencies, whereas countries like Germany permit such investments. This disparity reveals the necessity for a consistent regulatory framework across Europe to aid asset managers operating in various jurisdictions and provide clarity for those seeking to engage with the crypto market.
The situation with Jupiter Asset Management highlights the challenges that inconsistent regulations pose to institutional investors pursuing cryptocurrency opportunities. As the US sees the introduction of direct cryptocurrency investment products causing market fluctuations, European investors continue to grapple with a fractured regulatory scenario, hindering broader market participation.
Jupiter’s retraction from the XRP ETP investment underscores the complexities and potential obstacles faced by investment firms navigating the cryptocurrency investment terrain due to fluctuating regional regulatory landscapes.