Sweden's Nasdaq exchange has approved a bitcoin-based exchange traded note (ETN), opening up investment in the digital currency to those who do not want to directly purchase and hold bitcoins.

The Bitcoin Tracker One, launched by Stockholm-based XBT Provider AB, which is owned by the KnC Group and is expected to launch on 18th May.

In a statement, Alexander Marsh, chief executive officer of XBT Provider AB, said:

A spokesperson for Nasdaq confirmed that XBT Provider AB had been approved as a certificate issuer and that its product was the first bitcoin-based item to be listed on the Swedish exchange.

According to XBT Provider AB's website, the bitcoin ETN is traded in the same way as all other listed instruments on the Nasdaq exchange.

In order to invest, users must have an account obtained through their bank, advisor or online broker.

XTB Provider AB will hedge all sales of the bitcoin traded note by buying an equal value in the bitcoin market.

Johan Wattenström, head of trading at KnCMiner and partner at XBT Provider AB, said:

When asked about its security procedures, Wattenström said the company had implemented a "secure multi-layer process for handling and safekeeping bitcoins".

He also referred to the company's safety policy, which states: "A small part of the holdings can be kept on bitcoin exchanges, if deemed necessary additional coins can be held on a multi-signature hot wallet and all holdings over a threshold must be kept in safe storage."

Joakim Herlin-Ljunglof, marketing manager at Stockholm-based bitcoin exchange BTCX, commented on the approval, noting how it could impact the discussions between companies operating in the bitcoin space and traditional banks, regulators and investors. He added:

"It is really cool that my country and city is, apparently, the first in the world to do this."

The news also struck a chord with the international cryptocurrency ecosystem. Dr Timo Schlaefer, co-founder and CEO of Crypto Facillities, a London-based broker specialising in bitcoin derivatives, said:

Wattenström said XBT Provider AB aimed to offer a range of additional investment products in the future.

Stockholm image via Shutterstock.