CRO ETF Launches After Crypto.Com Revives 70 Billion Burned Tokens

I have already covered the myriad ways that Crypto.com’s controversial proposal to put new life into 70 billion previously burned tokens was problematic. But now they are getting the ETP treatment.

I cannot imagine a better reason to always do your own research before buying an investment.

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CRO ETF Launches After Crypto.com Revives 70 Billion Burned Tokens

The crypto exchange went against its constituents’ wishes to reincarnate 70 billion tokens that were burned in 2021. Now ETP provider 21Shares is selling them to investors.

Former Securities and Exchange Commission Chair Gary Gensler famously said, after he approved spot bitcoin ETFs in January 2024, “While we approved the listing and trading of certain spot bitcoin ETP shares today, we did not approve or endorse bitcoin. Investors should remain cautious about the myriad risks associated with bitcoin and products whose value is tied to crypto.”

Notwithstanding his consternation at finally signing off on these products, which now have $120.3 billion in AUM, it is a sober and important warning. Just because the SEC or any counterpart around the world approves an application does not mean that users should assume that it is a good investment.

Gary Gensler had many reservations about bitcoin. In the same statement, he wrote, “Though we’re merit neutral, I’d note that…bitcoin is primarily a speculative, volatile asset that’s also used for illicit activity including ransomware, money laundering, sanction evasion, and terrorist financing.”

It is fair to wonder what he would say about an ETF that tracks CRO, the native token of the Cronos blockchain. 

CRO Printer Go BRRRR

As Unchained previously reported, Crypto.com, the founding firm and controlling entity behind the $9.5 billion blockchain (at fully diluted value), pushed through a controversial vote — against the wishes of its community — to remint 70 billion CRO tokens that were taken out of circulation back in 2021. 

The total supply is now back up to its original 100 billion units, with the new tokens placed in a strategic reserve operated by Cronos Labs to be released periodically in the coming years.

A token undergoing a 233+% inflation rate in a single day, especially one that broke a cardinal rule of crypto, which is that tokens taken out of circulation can never return, might seem like a tough sell. As is a token that is down 35.94% this year despite a high-profile partnership with Trump Media & Technology Group (Nasdaq: DJT) (“TMTG”) and its partner, Yorkville America, “to support and power a series of TMTG-branded ETFs comprising digital and non-digital assets, including a first of its kind ETF basket of cryptocurrencies incorporating CRO and other crypto assets,” according to a March 24 press release. The below chart demonstrates a brief price bump around the time of the announcement, but many of those gains were quickly given up.

186X More Expensive Than Alphabet 

On May 6, 21Shares launched an ETP trading on Euronext Paris and Euronext Amsterdam offering exposure to the token for a fee of 2.5%. In the launch’s announcement, which made no mention of the controversial vote, Mandy Chiu, head of financial products development at 21Shares, said, “Cronos is uniquely positioned at the intersection of centralised access and decentralised innovation…By launching a Cronos ETP, we are offering investors easy, regulated exposure to a blockchain ecosystem that is driving real-world adoption and pioneering the future of Web3.”

She did not mention that the blockchain only made $2.05 million in fees last year, according to Token Terminal. This would give it a price-to-sales ratio (P/S) of 1873. And that figure only uses CRO’s circulating market capitalization, not the fully diluted 100 billion figure. By comparison, a tech firm like Alphabet had a (P/S) of 7.1 at the end of 2024. And that number comes at a time when Magnificent 7 stocks, which includes Alphabet, were particularly frothy. 

When asked for comment about the controversial launch, Chiu responded via written comments, “We are closely monitoring the recent governance developments. Governance is a critical aspect of any blockchain ecosystem, and different networks take different approaches. We recognise that Cronos operates under a more centralised model, which may differ from fully decentralised protocols…We will continue to evaluate how governance decisions are made and communicated, and whether they maintain the integrity and trust of the ecosystem over time.”

Representatives for Crypto.com declined to be interviewed for this story.

Related content: 

• Crypto.com Forces Through Controversial Vote to Re-Mint 70 Billion CRO

• Burned Tokens Are Gone Forever, Right? For 70 Billion CRO, Maybe Not

• Michael Saylor Copycats Rush to Win the Solana Rat Race. Can Lightning Strike Twice?