Australia is gearing up for the launch of its first-ever Bitcoin exchange-traded fund (ETF), which will directly hold the digital asset. The Monochrome Bitcoin ETF (IBTC) is scheduled to start trading on the Cboe Australia exchange on Tuesday, June 4.
While Australia already has various exchange-traded products providing exposure to Bitcoin, Monochrome Asset Management stands out as the first to receive approval for a new crypto asset licensing category established under Australian Financial Services (AFS) licensing rules in 2021. This unique license enables the ETF to directly hold Bitcoin (BTC). Monochrome has emphasized that IBTC’s holdings are securely stored offline and adhere to Australian institutional custody regulatory standards.
Prior to IBTC, Australian investors were limited to ETFs indirectly tied to Bitcoin or offshore Bitcoin products, which lacked the investor protection provided by the directly held crypto asset AFS licensing regime.
In contrast to similar products in the United States that are cash-based, IBTC allows investors to redeem holdings in-kind. Monochrome CEO Jeff Yew expressed confidence in the ETF’s potential, citing the growing interest in indirect Bitcoin ETFs in recent months. Yew also revealed plans to develop and launch an Ether (ETH) ETF that would likewise directly hold the asset, while exploring other opportunities within the digital asset sector to meet investor demand.
The launch of IBTC in Australia closely follows the introduction of four spot Bitcoin ETFs in Hong Kong on April 30. However, the majority of the Hong Kong ETFs have experienced net outflows since their launch, with the exception of Bosera’s spot Bitcoin ETF. In contrast, U.S. Bitcoin ETFs have seen significant inflows, with a total of $13.9 billion, offsetting the $17.9 billion outflows from the Grayscale Bitcoin Trust.
Yew emphasized Australia’s strong affinity for crypto and predicts that local spot Bitcoin ETFs could attract between $3 billion to $4 billion in net inflows within the initial three years.
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