The Australian markets look set for their first taste of cryptocurrency, with two Spot Bitcoin Exchange Traded Funds (ETFs) and one Ethereum Exchange Traded Fund (ETF) going live as early as next week. The ETFs are a result of a partnership between Swiss-based 21Shares, and Australian ETF Securities.
This is seen as a significant development as American regulators continue to drag their feet.
Details About The ETFs
Two spot crypto ETFs will be launched by 21Shares, the world’s largest issuer of crypto-traded products in partnership with ETF Securities, while a third, proposed by Cosmos Asset Management, will also be launched on the same day. The ETFS 21Shares Bitcoin ETF and the ETFS 21Shares Ethereum ETF, which will track the price of BTC and ETH in Australian Dollars, are fully backed by the assets held in cold storage by crypto exchange Coinbase. The ETFs will be listed on the Cboe Australia Exchange on the 27th of April.
The third crypto ETF, that of Cosmos Asset Management, will launch on the 27th of April as well. The Cosmos fund is slightly different as instead of direct spot exposure; it is expected to invest in crypto via the Purpose Investments’ Bitcoin ETF. The Purpose Investments’ Bitcoin ETF launched on the Toronto Stock Exchange in February 2021.
Australian Investors Get Easy Access To Crypto
Speaking about the Australian debut of ETFs, Hany Rashwan, the CEO of 21Shares, stated that the firm has been tirelessly working to make crypto more accessible to Australians. He further added,
“That valuable experience and deep data is consistently instrumental in all of our regulatory conversations. There’s more to crypto than just Bitcoin and Ethereum, and we look forward to making the entire crypto world accessible and investable for everyone around the world.”
21Shares currently has around $2.5 billion in assets under management, with its products listed on ten regulated European exchanges, and has been running the world’s longest-running spot Bitcoin ETP, launched in Switzerland back in 2019.
Speaking about the crypto ETFs for the Australian market, the executive chairman of ETF Securities Australia, Graham Tuckwell, stated,
“Once we decided to build a range of crypto ETFs for the Australian market, there was only one partner we wanted to work with. [21Shares’] pioneering approach to secure investment in cryptocurrency has been emulated by other fund managers around the world.”
A Regulatory Breakthrough
Several ETFs have been launched across Europe and Canada, investing directly in crypto assets. However, the Australian launch is significant because of the prior regulatory attitude towards crypto and other digital assets. Previously, the consensus amongst regulators in Australia was that crypto was too volatile to be part of the country’s financial markets.
However, there has been a slight shift thanks to efforts from some Australian politicians, who are willing to work with proponents of crypto and draw up appropriate legal frameworks for crypto-assets and crypto exchanges, and usher in a new avenue for Australian Investors. There is a further boost towards crypto adoption thanks to private-sector experiments with the emerging asset class.
Financial Institutions On Board
Financial institutions in Australia also seem to be warming up to the idea of crypto and digital assets as well, with ANZ bank becoming the first major financial institution in Australia to execute payment of a stablecoin linked to the Australian Dollar. This marks another significant step in Australia’s crypto adoption journey.
Other ETPs by 21Shares
21Shares has already launched a few ETPs during the current year, with Aave (AAVE), Chainlink (LINK), and Uniswap (UNI) as their underlying assets. Rashwan has already outlined plans to support some of the top 50 cryptocurrencies by the end of 2022. The new launches come against the SEC’s continued denial of proposals for Spot Bitcoin ETFs from US fund issuers, with no clear timeline for their approval.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
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