The agency has allowed ETPs and ETFs based on Bitcoin and Ethereum and expects to include more cryptocurrencies. Jane Hume highlighted that the Australian government has no problem with crypto assets, but she warned about the risks of that volatile market.
The Australian Securities and Investments Commission (ASIC) recently responded to many inquiries about cryptocurrency-based exchange-traded products (ETPs). The Australian regulatory institution released the regulatory requirements for those funds wanting to offer cryptocurrency ETPs and ETFs.
The official guide indicates that the ASIC has allowed ETPs and ETFs based on cryptocurrencies such as Bitcoin and Ethereum. That agency expects more cryptocurrency-linked digital assets to serve as a foundation for new ETPs and ETFs.
According to the ASIC, Bitcoin and Ethereum will meet five factors to determine the appropriate underlying assets for an ETP and ETF in October.
The guide states that crypto assets must receive a high level of institutional support to become a suitable foundation for an ETF. It also mentions that they need a robust spot market, a regulated futures market, reputable and experienced service providers, and transparent price mechanisms.
Licensed exchanges must assess whether the issuer of an application for a cryptocurrency ETF can meet its obligations concerning the product. These would include providing safe and secure custody, as well as the ownership of relevant licenses.
Australian traditional ETF provider BetaShares is preparing to launch a cryptocurrency ETF. The BetaShares cryptocurrency ETF will go public on the Australian Stock Exchange under the code CRYP.
The Adoption of Bitcoin and Other Cryptocurrencies in Australia
Not long before that, Australian fund manager Cosmos Asset Management debuted with an ETF linked to cryptocurrency mining. The Cosmos Global Digital Miners Access ETF began trading under the name DIGA.
In January, the Australian Senator and Minister for Financial Services, Jane Hume, has highlighted that the Australian government has no problem with people investing in cryptocurrencies. She also shared an optimistic view on crypto assets such as Bitcoin, but she warned about the risks of that volatile market.
Australia currently has the third-largest volume of cryptocurrencies, with 17.8% of the total market. Twenty percent of Australians own a cryptocurrency, of which the most popular is Bitcoin.
The Wave of ETFs Is Just Starting in the United States
VanEck recently announced the launch of the third ETF of the United States but postponed it until November 5th. However, they recently confirmed that it would take place next week.
The launch of ETFs in the United States is just starting, and there are about 19 applications with the SEC waiting for approval.
There have been more than 40 new Bitcoin ETF applications with the SEC so far. Therefore, the fourth quarter could set a record for a significant addition of Bitcoin to traditional finance.
On August 3rd, the president of the SEC, Gary Gensler, made a statement that led to proposals for ETFs based on Bitcoin futures. He said that they could approve Bitcoin ETF associated with futures contracts but under strict mutual fund rules.
By Alexander Salazar
