As the Australian financial industry is ready to welcome a fresh wave of Bitcoin exchange-traded funds (ETFs), it is in position for a seismic shift. This announcement followed successful models in the US and, soon to be, Hong Kong.
Industry observers anticipate a dramatic change in the continent's bitcoin investment habits, with major issuers spearheading the movement.
The Need for New Bitcoin ETFs May Be Fueled by Australia's Pension Sector
Most of Australia's equities trading is handled by ASX Ltd., the country's main securities exchange. According to the most recent source, it may approve its first set of Bitcoin ETFs. According to people with knowledge of the situation, these approvals might come to pass by the end of 2024.
BetaShares is working hard in Sydney to get their product listed on the ASX. In a recent interview, a firm representative revealed that they have already set up ticker symbols for its spot Ethereum and Bitcoin ETFs. In a similar vein, another Australian company, DigitalX Ltd., revealed in its half-year results that it had filed an application.
Simultaneously, VanEck, an established player in the ETF space with offerings in both the US and Europe, returned to the Australian market. Early this year, the business resubmitted their application.
Riding the current market trends is not the only reason for the renewed interest in cryptocurrency exchange-traded funds (ETFs). The strong $2.3 trillion pension system in Australia may play a major role in maintaining capital inflows into these novel financial vehicles. According to Bloomberg, roughly a quarter of the nation’s retirement assets are held in self-managed superannuation funds.
Investors can diversify into cryptocurrencies with the flexibility provided by these funds.
VanEck Australia's Jamie Hannah, Deputy Head of Investments and Capital Markets, highlighted the potential for these self-directed funds to increase the uptake and performance of the suggested ETFs.
"There is a sizable enough addressable market here with self-managed super funds, brokers, financial advisers, and platform money to get this ETF to an adequate size," Hannah stated.
There are obstacles in the way of ETF dominance in Australia, though. Spot Bitcoin ETF launches in the past have met with varying degrees of success.
For example, in 2022 the CBOE Australia saw the introduction of Cosmos Asset Management's spot Bitcoin ETF. However, because investors showed little interest, it was short-lived and later delisted. However, the Global X 21Shares Bitcoin ETF, which was introduced around that same time frame, is still managing assets valued at about $62 million.
This action may be a significant turning point, reflecting the fervor in the US. US Bitcoin ETFs have amassed an astonishing $53 billion in assets since their debut trading day.
SoSo Value data indicates that the Bitcoin spot ETF saw three days in a row with negative total net flows last week. One of the best-performing ETFs, BlackRock's spot Bitcoin ETF, iShares Bitcoin Trust (IBIT), has not had any inflows since April 24, 2024.
Traditional financial hubs are not the only places this increased interest can be found. Additionally, Hong Kong is preparing the ground for funds to make direct investments in Bitcoin and Ethereum, with trading scheduled to start this Tuesday.
The global financial community is keeping a careful eye on Australia as it gets ready to introduce spot Bitcoin exchange-traded funds. The results of these launches may show whether or not cryptocurrency is a good asset for regular investors to invest in.
April 2024, Cryptoniteuae