Australian companies are gearing up to launch ‘inevitable’ local Bitcoin ETFs

Australian companies are gearing up to launch ‘inevitable’ local Bitcoin ETFs

BUSINESS/ECONOMY | OCT 27, 2021 | WOZINGA NEWS

Australian companies are gearing up to launch 'inevitable' local Bitcoin ETFs

  • Fund managers are preparing to launch an Australian Bitcoin exchange-traded fund.
  • The interest exploded after the success of similar new offerings in the United States last week.
  • Some groups predict that local options will be available by mid-next year.

By Elah Mae Ariate Wozinga Staff

ETFs enable investors to purchase various securities, commodities, or indices without having direct exposure to the asset.

According to the report, the funds are a low-risk way to invest in higher-risk sectors such as real estate or technology.

Interest exploded after first Bitcoin Futures ETF was approved for trade in the US

Since Bitcoin’s mainstreaming four years ago, investors have been clamoring for an ETF that tracks the price of major cryptocurrencies. It can be very volatile, as a way for traditional investors to gain exposure to the space.

However, interest has exploded in recent weeks following the approval of the first-ever Bitcoin futures ETF for trading in the US, sending the digital currency’s price up 50% in the last month to nearly $85,000. Although a second ETF, launched just days after the first, fell 2.8% on its first day.

According to the SMH report, crypto ETFs are currently unable to operate in Australia. Because of the regulatory concerns about asset custody. However, local investment firms are preparing for this to change by next year.

The corporate regulator is currently finalizing a review into the feasibility of such funds and how they would operate in the market.

Australian firms are interested in launching local Bitcoin ETF

Alex Vynokur, CEO of $20 billion ETF provider Betashares, confirmed that his company wants to establish an Australian Bitcoin ETF when regulations allow it. He said such a fund was inevitable in Australia, given the interest in the nascent asset class.

“At the moment, we see some statistics in Australia that show that well over a million Australians have a direct investment in cryptocurrencies,” he said. “We believe that, in time, Bitcoin and, hopefully, other cryptocurrency exchange-traded funds will be available.”

Similarly, Heath Behncke, the managing director of innovation-focused fund manager Holon, expects to launch an Australian Bitcoin ETF by mid-2022. In addition, Holon is hoping to be one of the first to do so.

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