According to a report by Bloomberg, Australia’s largest stock exchange, the Australian Securities Exchange (ASX), could approve several spot Bitcoin exchange-traded funds (ETFs) by the end of 2024. This move follows the footsteps of fund issuers in the United States and Hong Kong, where spot Bitcoin ETFs have gained significant popularity.
Sources familiar with the matter told Bloomberg that applications from VanEck Australia and BetaShares, a local ETF-focused fund manager, are set to be approved before the year is through. The uptick in spot Bitcoin ETF applications comes following the Bitcoin ETF approvals in the United States, which have seen some $53 billion in assets under management (AUM) accrued across eleven separate products.
Justin Arzadon, the head of digital at BetaShares, said that the considerable inflows into U.S.-based ETFs have provided the confidence to launch the products in Australia and “prove digital assets are here to stay.”
Speaking to Cointelegraph, Jeff Yew, the CEO of crypto asset management firm Monochrome, which has an application with a competing exchange, described Australia as a “very crypto-heavy country” and expects Australian spot Bitcoin ETFs to generate between $3 billion to $4 billion in net inflows within the first three years.
Yew explained that the demand for the Bitcoin ETFs would be driven primarily by fund managers looking to gain exposure to Bitcoin and from self-managed super fund (SMSF) investors, as well as a smaller yet still considerable appetite from retail.
SMSF investors currently hold direct exposure to Bitcoin on crypto exchanges, something Yew said is inherently risky and feels like a “ticking time bomb” if crypto exchanges were to collapse. “The Australian Taxation Office says there’s over $1 billion of crypto on exchanges and the majority of this is from SMSF investors,” he said. Bitcoin ETFs, on the other hand, allow these investors to gain heavily regulated and, therefore, safer exposure to digital assets, said Yew.
Monochrome first applied for a spot Bitcoin ETF with the ASX on July 14, 2023, but later switched to Cboe Australia, a much smaller exchange, following a slow approval process at the ASX.
“We switched to Cboe because it’s an exchange that offers a more realistic time frame and a more transparent listing framework,” Yew said. “It’s no secret that the ASX had challenges lately with the regulator. I think that’s just the appetite to push for new products is limited.”
Yew still expects Cboe Australia to approve his firm’s application “within the next few weeks.”
This news comes as a significant development for the crypto industry in Australia, where the regulatory environment has been challenging for crypto businesses in the past. The approval of spot Bitcoin ETFs could provide a boost to the crypto market in the country and pave the way for further innovation in the space.
Sources:
- https://cointelegraph.com/news/australian-stock-exchange-asx-approve-spot-bitcoin-etf
- https://www.bloomberg.com/news/articles/2024-04-28/australia-s-top-exchange-said-to-be-weighing-spot-bitcoin-etfs
- https://www.afr.com/markets/debt-markets/spot-bitcoin-etfs-could-be-approved-in-australia-this-year-20240428-p5di8a
- https://www.asx.com.au/
- https://www.betashares.com.au/
- https://www.vaneck.com/
- https://www.monochrome.co/
- https://www.cboe.com.au/
- https://www.cryptoquant.com/
- https://www.ato.gov.au/
