Australia’s largest stock exchange — the Australian Securities Exchange (ASX) — could greenlight several spot Bitcoin (BTC) exchange-traded funds (ETFs) by the end of 2024.
Following in the footsteps of fund issuers in the United States and Hong Kong, spot Bitcoin ETF applications from VanEck Australia and local ETF-focused fund manager BetaShares are set to be approved before the year is through, anonymous sources familiar with the matter told Bloomberg.
The uptick in spot Bitcoin ETF applications comes following the Bitcoin ETF approvals in the United States, which have seen some $53 billion in assets under management (AUM) accrued across eleven separate products.
The considerable inflows into U.S.-based ETFs have provided the confidence to launch the products in Australia and “prove digital assets are here to stay,” said Justin Arzadon, the head of digital at BetaShares.
Speaking to Cointelegraph, Jeff Yew, the CEO of crypto asset management firm Monochrome — which has an application with a competing exchange — described Australia as a “very crypto-heavy country” and expects Australian spot Bitcoin ETFs to generate between $3 billion to $4 billion in net inflows within the first three years.
Yew explained that the demand for the Bitcoin ETFs would be driven primarily by fund managers looking to gain exposure to Bitcoin and from self-managed super fund (SMSF) investors, as well as a smaller yet still considerable appetite from retail.
SMSF investors currently hold direct exposure to Bitcoin on crypto exchanges, something he said is inherently risky and feels a lot like a “ticking time bomb” if crypto exchanges were to collapse.
“The Australian Taxation Office says there’s over $1 billion of crypto on exchanges and the majority of this is from SMSF investors,” he said.
Bitcoin ETFs, on the other hand, allow these investors to gain heavily regulated and, therefore, safer exposure to digital assets, said Yew.
Monochrome first applied for a spot Bitcoin ETF with the ASX on July 14, 2023, but later switched to Cboe Australia — a much smaller exchange — following a slow approval process at the ASX.
“We switched to Cboe because it’s an exchange that offers a more realistic time frame and a more transparent listing framework."
“It’s no secret that the ASX had challenges lately with the regulator,” Yew said. “I think that’s just the appetite to push for new products is limited.”
Yew still expects Cboe Australia to approve his firm’s application “within the next few weeks.”
Related: Australian Monochrome spot Bitcoin ETF expected to launch within 2 months, says CEO