First spot bitcoin ETF application filed under new Australian regulations – Crypto News – Crypto News
Connect with us
First spot bitcoin ETF application filed under new Australian regulations First spot bitcoin ETF application filed under new Australian regulations

Cryptocurrency

First spot bitcoin ETF application filed under new Australian regulations – Crypto News

Published

3 years ago

on

An application for Australia’s first fully-licensed spot bitcoin ETF under new regulatory guidelines has been filed with the Australian Securities Exchange (ASX).

Bitcoin-focused asset management firm Monochrome, in partnership with Vasco Trustees, announced Friday the lodgement of an updated application for the Monochrome Bitcoin ETF (IBTC) – intended to provide regulated exposure for retail investors.

The move marks the first instance of a filing for a spot bitcoin ETF on the ASX under a licensing regime featuring crypto provisions, established almost two years ago.

It also follows a year after Monochrome’s partner Vasco received a financial license to operate crypto spot ETFs in the country.

ASIC, the country’s securities regulator, Revised its rules for the Australian financial services (AFS) license in October 2021. ASIC sought to promote market transparency amongst crypto firms while enhancing investor protections.

The rules dictate that institutional support and acceptance of the underlying crypto must exist for a spot ETF to go through. “Reputable” and “experienced” service providers must be willing to support those products.

As it stands, there are only two such AFS licenses, including the issuer behind Monochrome’s ETF. The other, K2 Asset Management, is listed as wholesale, meaning they are not yet green-lit to offer such products to retail investors under a direct fund structure.

Other Australian attempts at bitcoin ETFs

Another bitcoin ETF from Cosmos Asset Management’s bitcoin ETF attempted to take the crown as the country’s first last year, spot or otherwise.

That ETF, however, was established as a fund of funds, offering exposure to one of Canada’s spot bitcoin ETFs managed by Purpose. Global X and 21Shares’ Bitcoin ETF ended up being the first to list in Australia, while Cosmos delisted Its offering in November due to lack of interest.

Global X 21Shares’s Bitcoin ETF, still trading today, operates using a wholesale-retail feeder fund structure. In this setup, a retail fund invests in a wholesale fund that directly holds bitcoin.

Although the wholesale fund is not subject to the newly instituted regulations specifically aimed at retail funds dealing with digital assets, Blockworks was told.

“What sets us apart from other fund structures is that the Monochrome Bitcoin ETF is authorized under the ‘crypto-asset’ licensing category, which allows the fund to hold bitcoin directly at the fund level,” Jeff Yew, Monochrome CEO, said.

The executive added that he was confident that a positive outcome would be reached.

When asked about the poor performance of Australia’s spot bitcoin ETFs, the executive reasoned that Cosmos’ delisting was driven by unfavorable market timing, confusion about the fund’s licensing and operational issues leading to discrepancies between the unit price and bitcoin..

The current climate presents a “different circumstances and product structure/licensing,” Yew said.

Renewed interest in spot bitcoin ETFs has also hit the US, with major institutions such as BlackRock, Invesco and WisdomTree all filing over the past month,

Get the day’s top crypto news and insights delivered to your email every evening. Subscribe to Blockworks’ free newsletter now.

Want alpha sent directly to your inbox? Get degen trade ideas, governance updates, token performance, can’t-miss tweets and more from Blockworks Research’s Daily Debrief,

Can’t wait? Get our news the fastest way possible. Join us on Telegram and follow us on google news,

Related Topics:
Continue Reading
Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

Trending