Investors in Australia can offer, buy and trade Bitcoin and Ether in the traditional stock market, following the approval of Bitcoin and Ethereum spot ETFs by the Australian Securities and Investments Commission (ASIC).
ASIC provided a set of guidelines that will allow investment funds to offer ETFs pegged to cryptocurrencies, enabling direct exposure to cryptocurrency assets for more investors.
The decision is a result of discussions among various regulators in the country on how to regulate Exchange Traded Products (ETPs) in the emerging digital assets class.
The announcement also makes ASIC the latest regulator and among the first to approve spot ETFs for cryptocurrencies in the world.
Cathie Armour, ASIC Commissioner said crypto assets possess unique qualities and risks that product issuers and market operators must consider to meet their existing regulatory requirements.
“The good practices we published provide practical examples of how these obligations maybe met, in a way that maintains investor protections and Australia’s fair, orderly and transparent markets.”
Bitcoin ETFs Slowly Gaining Traction Globally
The approval is the second major crypto-assets ETFs greenlight of the month, following the recent launch of three Bitcoin futures ETFs in the US, with approval from the Securities and Exchange Commission (SEC).
In February 2021, Canada approved three Bitcoin ETFs to trade on the Toronto Stock Exchange, including Purpose Bitcoin ETF, Evolve Bitcoin ETF, and CI Galaxy Digital.
In Brazil, QR Capital became the first to receive a Bitcoin ETF approval from the Brazilian Securities and Exchange Commission (CVM) in mid-March 2022. The Fund ETF started trading 3 months later on June 23, on the Brazil Stock Exchange as the first Bitcoin EFT in Latin America.
The debut of Bitcoin ETFs and Bitcoin futures ETF have resulted in tremendous growth in the cryptocurrency market. ETFs played an important role in increasing institutional adoption in the first quarter of 2021, which saw Bitcoin record an all-time high of over $64,000.
Most importantly, the Bitcoin futures ETFs market in the US saw ProShares Bitcoin fund (BITO) become the second-most traded ETF in history and the fastest to record $1 billion in AUM, due to extra-high demand. Bitcoin’s current new all-time high of $66,930 was driven by the anticipation and launch of the ETFs.
According to BetaShares Investments firm, Canada is providing a model for the expansion of the Australian ETF sector, including in Bitcoin-related products offerings. The report by Bloomberg said the growth of the crypto ETF sector in Canada is a clear indication that Australia could handle Bitcoin ETFs with as much as $376 million in Assets under Management (AUM).