The launch of the trio marks the first crypto ETFs launched in Australia, two of which are focused on supplying BTC and the other on ETH.
Fueling the cryptocurrency markets, three cryptocurrency-focused exchange-traded funds (ETFs) have chosen a difficult day to start trading on local exchange Cboe Australia today.
The trio’s launch marks the first crypto ETFs launched in Australia, with two focusing on the supply of Bitcoin (BTC) and the other focusing on Ether (ETH).
The three ETFs have collectively generated more than $1.3 million to date, and it is estimated that they could generate about $1 billion in future inflows.
Sydney-based crypto investment firm Cosmos Asset Management Cosmos Purpose Bitcoin Access ETF (CBTC) offers a relatively indirect path to BTC as it “roughly matches the performance of non-currency hedged USD denominated ETF units (ETF target units). the purpose of the bitcoin ETF.”
The other two ETFs were developed by ETF Securities in collaboration with major Swiss exchange-traded product provider (ETP) 21 Shares. The funds are called Bitcoin ETF (EBTC) and Ethereum ETF (EETH). Both track the value of their holdings in Australian dollars (AUD).
According to Cboe at the time of writing, 21 shares of EBTC and EETH were trading at 125,271 and 142,206 shares, respectively, for roughly $519,874 and $416,663, respectively.
The Cosmos Asset Management fund got off to a relatively slow start, with 51,572 shares sold for a total of $398,135. However, activity could pick up again shortly after the company waived CBTC fees for two months to attract institutional interest.
Kanish Chug, head of sales at ETF Securities, told Cointelegraph about the launch, noting that while it was a difficult time to launch amid the collapse of the crypto market, it also offers investors a reasonable chance to get involved:
“Given the short-term volatility of the markets, it will be difficult to determine the performance of bitcoin and ether. However, we are seeing bitcoin drop more than 50% from its 2021 peak and investors are looking at the current volatility as an investment opportunity.”
“Our crypto ETFs are physically collateralized and track the underlying price of bitcoin and ether, and we are very hopeful that EBTC and EETH will be successful in the long term,” he added.
In a public statement, given the importance of BTC and ETH, ETF Securities Chairman Graham Tuckwell also stressed the importance of launching cryptocurrency ETFs in a local context.
“The market capitalization and trading volume for these two leading cryptocurrencies is currently larger than any company listed on the Australian Stock Exchange, but investors have not been able to gain regulated access to them,” he said.
However, despite the momentous moment, not everyone was as optimistic as Kraken Australia Managing Director Jonathon Miller hailed this “significant milestone in the development of the digital asset space” while noting that investors can already buy Bitcoin:
“However, this is not necessarily a turning point for accessibility. We must remember that individual investors can already buy Bitcoin directly, and any level of abstraction other than the underlying asset can increase risk and cost.”