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Australian Regulatory Body Greenlights Bitcoin, Ethereum Spot ETFs

Australian Regulatory Body Greenlights Bitcoin, Ethereum Spot ETFs

Investors in Australia had some good news coming their way, with the Australian Securities and Investment Commission (ASIC) giving its approval to investors to offer, buy and trade Bitcoin and Ether in the traditional stock market. 

This comes after the Australian regulator gave the green light for Bitcoin and Ethereum spot ETFs. 

List Of Guidelines 

The Australian Securities and Investment Commission released a set of guidelines on Friday regarding the requirements related to crypto exchange-traded products, allowing investment funds to offer their customers ETFs pegged to cryptocurrencies. This will allow investors to have direct exposure to cryptocurrencies. 

The decision by ASIC to approve ETFs came after a series of discussions between different regulators in the country regarding the regulation of Exchange Traded Products (ETPs) in the digital assets class.

One Of The First To Approve ETFs 

The Australian Securities and Investment Commission’s decision to approve ETFs makes it one of the first regulators to approve spot ETFs for cryptocurrencies. ASIC Commissioner Cathie Armour stated that while crypto assets possess certain unique qualities, they also possess certain risks that market issuers and market operators need to consider in order for crypto assets to meet certain regulatory requirements. 

“The good practices we published provide practical examples of how these obligations may be met, in a way that maintains investor protections and Australia’s fair, orderly and transparent markets.”

Traditional Investors Get Access To Crypto 

With the approval of the Bitcoin and Ethereum ETFs, traditional investors finally have an ETF to track the prices of major cryptocurrencies, allowing them to gain exposure to the crypto sector. The Bitcoin Futures ETF was launched last week in the US after gaining approval from the Securities and Exchange Commission. 

ASIC has been contemplating approving similar funds for some time now, with today’s announcement coming only a couple of weeks after Liberal Senator Andrew Bragg tabled a significant crypto reforms package in parliament. 

Gaining Global Traction 

The ASIC approval is the second major crypto-asset approval of the current month, with the first being the launch of three Bitcoin Futures ETFs in the United States after gaining approval from the SEC. Canada too gave approval to three Bitcoin ETFs to trade on the Toronto Stock Exchange in February 2021. The approvals include Purpose Bitcoin ETF, Evolve Bitcoin ETF, and CI Galaxy Digital. 

The Brazilian Securities and Exchange Commission (CVM) also gave QR Capital approval for its Bitcoin ETF, with the fund starting trading in June on the Brazilian Stock Exchange. This was the first ETF announced in Latin America. 

Driving Tremendous Growth 

Bitcoin ETF and Bitcoin Futures ETF have resulted in a surge in growth in the cryptocurrency space. ETFs have helped increase institutional adoption in the first quarter of 2021 and have driven Bitcoin to a new all-time high. 

The ProShares Bitcoin Fund also became the second-most traded ETF in history and also became the fastest to record $1 billion in Assets Under Management (AUM). BTC’s new all-time high was also achieved thanks to high anticipation around the launch of the Bitcoin ETFs. 

Australia is looking to Canada to provide a model for the expansion of its ETF sector. 

Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.