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Australia's top exchange, the ASX, is poised to approve its first spot in Bitcoin ETFs. This could potentially unlock $3 to $4 billion in initial inflows over the next three years, bolstering the country's robust crypto market presence.
Spot Bitcoin ETFs Anticipated to Bolster Australia's Crypto Market
In a recent report by Cointelegraph, Australia's leading stock exchange, the Australian Securities Exchange (ASX), may approve multiple spot Bitcoin exchange-traded funds (ETFs) by the end of the year.
According to unnamed sources, following in the footsteps of fund issuers in the United States and Hong Kong, VanEck Australia, and local ETF-focused fund manager BetaShares' Bitcoin ETF applications are expected to be granted by the end of the year.
The increase in spot Bitcoin ETF applications follows Bitcoin ETF approvals in the United States, which have resulted in $53 billion in assets under management (AUM) across eleven different products.
The significant inflows into U.S.-based products have given the company confidence to launch the products in Australia and "prove digital assets are here to stay," according to Justin Arzadon, BetaShares' head of digital.
Speaking to Cointelegraph, Jeff Yew, CEO of crypto asset management firm Monochrome, which has an application with a competing exchange, described Australia as a "very crypto-heavy country" and predicted that Australian spot Bitcoin ETFs would generate between $3 billion and $4 billion in net inflows within the first three years.
Yew said that demand for Bitcoin ETFs would be driven chiefly by fund managers seeking exposure to Bitcoin and self-managed super fund (SMSF) investors, with a lower but significant desire from retail.
SMSF investors presently have direct exposure to Bitcoin on crypto exchanges, which he believes is inherently hazardous and seems like a "ticking time bomb" if crypto exchanges fail.
"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.
ASX Nears Approval of Groundbreaking Bitcoin ETFs
On the other hand, Bitcoin ETFs provide these investors with carefully regulated and thus safer exposure to digital assets, added Yew. Monochrome first submitted for a spot Bitcoin ETF with the ASX on July 14, 2018, but shifted to Cboe Australia, a considerably smaller exchange, because of the ASX's lengthy approval procedure.
"We switched to Cboe because it's an exchange that offers a more realistic time frame and a more transparent listing framework.”
"It's no secret that the ASX has had challenges lately with the regulator," Yew said." I think that's just because the appetite to push for new products is limited."
Yew anticipates Cboe Australia will approve his firm's application "within the next few weeks."
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