When the Cosmos Asset Management Bitcoin ETF launches on ASX Clear next week, Australian investors will be able to trade the country’s first Bitcoin spot ETF.
Financial regulators have approved Australia’s first Bitcoin ETF, which will begin trading on April 27 and could see up to $1 billion in inflows, according to the Australian Financial Review.
An ETF is a regulated exchange-traded fund that allows investors to profit from the price of Bitcoin (BTC) without directly owning any coins.
Cosmos Asset Management was chosen over local rivals VanEck, BetaShares, and EFT Securities to launch Australia’s first Bitcoin ETF. According to the Sydney Morning Herald, each company has been vying for regulatory approvals since at least March.
The Cosmos Asset Management Bitcoin ETF has been approved for listing on CBOE Australia by the Australia Securities Exchange (ASX) Clear capital markets clearinghouse. According to an April 19 article in the AFR, approval was granted after Cosmos secured the required four market participants to support the 42 percent margin requirements needed to cover the risk.
Through the Canadian Purpose Bitcoin ETF, the Cosmos Bitcoin ETF provides indirect exposure to spot Bitcoin investing.
Kurt Grumelart, a trader at Australian wealth management firm Zerocap, called the ETF approval “exciting” and said it “validates further institutional adoption” following the record-breaking launch of the Betashares CRYP fund, which invests in crypto-exposed US Shares. The fund received $10 million in net inflows within the first ten minutes of its launch in November 2021.
Grumelart anticipates that the new Bitcoin ETF will be equally successful.
“The event marks a large step forward for Australia and mainstream acceptance of the crypto industry as a whole.”
Grumelart anticipates that a successful launch will result in an influx of new players. “If overseas markets are any indication, a successful launch will almost certainly result in a slew of listings for crypto asset-based funds outside of Bitcoin,” he said.
This will be Cosmos’s second crypto-related ETF since the company launched its Global Digital Miners Access ETF last year.
Over the last year, Australian regulators have been working hard to establish clear rules for the cryptocurrency industry. The Australian Securities and Investments Commission (ASIC) wants more control over the industry, but Senator Andrew Bragg believes this is premature until cryptocurrency is recognized as a financial asset under Australian law.
Grumelart believes that clarifying the rules will help the industry develop.
“As the new ASIC regulations come out governing crypto assets, we expect greater clarity for local custodians and service providers, opening up this as an avenue within the coming year.”
