How to invest in crypto ETNs through an ISA
Since April, investors can only gain tax-free returns from a crypto ETN through an innovative finance ISA and the first product has now been launched.
The first innovative finance ISA (IFISA) product letting investors hold crypto exchange-traded notes (cETNs) has been released.
It comes after the Financial Conduct Authority (FCA) lifted a ban on cryptocurrency (crypto) exchange-traded notes (ETNs) to UK retail investors last year and new HMRC rules allowing cETNS to be held in an IFISA went live this month.
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But since the rules around crypto ETNs in ISAs changed at the start of the new tax year, there has been no qualifying provider offering IFISAs that can hold crypto ETNs – until now.
What are crypto ETNs?
An ETN is similar to an exchange-traded fund (ETF), but it tracks the price of a particular asset rather than a selection of assets.
In the case of crypto or cETNs, that asset is a cryptocurrency.
The FCA lifted a ban on retail investors holding cETNs in October 2025.
Initially, HMRC said cETNs could be held in a stocks and shares ISA but later confirmed that, from the start of the current tax year on 6 April, the only ISA wrapper they can be held in is an IFISA.
IFISAs are set up to hold alternative assets such as peer-to-peer loans, crowd bonds and now crypto ETNs.
Previously, investors who wanted exposure to crypto price movements within the tax-efficient ISA wrapper had to buy crypto proxy stocks, like Strategy (NASDAQ:MSTR) (formerly MicroStrategy), or funds that are comprised of similar stocks.
Who offers cETN IFISAs?
The IFISA market is pretty small, especially since previously big retail P2P lenders such as Zopa and Funding Circle exited.
The latest data available shows that there are around 17,000 IFISAs in the UK, compared to over 3.8 million stocks and shares ISAs.
The market for cETNs IFISAs is even smaller.
Investing platforms and apps such as Interactive Investor and Freetrade offer access to cETNs, but not through an IFISA.
Stratiphy gained IFISA manager status this month and has launched a partnership to allow investment into 21shares cETNs.
This makes it the only current IFISA provider that supports cETNS
Stratiphy’s chief executive Daniel Gold said: “With regulatory changes coming into effect, investors need a simple and compliant pathway to maintain exposure to digital assets. Our IFISA approval and partnership with 21shares allow us to deliver exactly that.”
Duncan Moir, president at 21shares, said: “The UK’s regulatory and tax landscape for digital assets is evolving rapidly, and our priority is ensuring that UK investors aren't penalised by complexity.
“Partnering with Stratiphy enables investors to build exposure to our crypto ETNs through a structure aligned with the UK’s evolving regulatory framework. Together, we are helping market participants navigate these transitions while maintaining seamless access to the most innovative assets in the crypto ecosystem.”
Should you buy a crypto ETN?
A cETN provides a way to gain exposure to cryptocurrency through a regulated provider and a product that is listed on the London Stock Exchange.
That gives you extra transparency and more solid fundamentals than directly putting money into cryptos such as Bitcoin or Ethereum, which are unregulated.
But you are still exposed to the volatile pricing and sentiment towards cryptocurrencies and the FCA has warned there is a risk of losing all your money when investing in the asset class.
However, the only other means of investing in crypto is directly and that would expose holders to paying capital gains tax (CGT) on any gains they realised. So holding a cETN in an IFISA can be more tax efficient as long as you are aware of and prepared for the risks.
