Monochrome revises filing for spot Bitcoin ETF at Aussie stock exchange

The CEO believes investors will be inclined to seek exposure to Bitcoin in a more familiar, structured and protected regulatory environment.

Australian-based crypto investment firm Monochrome Asset Management has updated its application to offer a spot Bitcoin (BTC) exchange-traded fund (ETF) on the Australian Securities Exchange (ASX) through its partner Vasco Trustees.

The ETF — Monochrome Bitcoin ETF — will be able to offer retail Australian investors direct exposure to Bitcoin and Ether (ETH), according to the firm’s July 14 announcement.

Australia joins the #Bitcoin race.#spot #bitcoinetf @MonochromeAsset https://t.co/hqXb9RY5HL pic.twitter.com/KEEXHQ9Eo6
— Jeff (@jeffyew_) July 13, 2023

Speaking to Cointelegraph, Monochrome CEO Jeff Yew explained that by obtaining a license, Australian retail investors would be exposed to Bitcoin within a formidable regulatory landscape:

“Through a Bitcoin ETF, it makes it possible for them to buy and use the asset class in however they see fit with the investment choices [and] in a regulated manner, and also operating within the regular regulatory perimeter.”

“So that is the benefit, I guess, compared to, say, unregulated exchanges where there’s no investor protection,” he added.

Yew believes that if a Bitcoin ETF goes live on ASX, it will send a “clear signal” to traditional investors that the “unregulated Wild West is coming to an end” because their investments will be backed by a “familiar,” “structured” and “protected environment.”

Vasco, its “Responsible Entity Partner,” is authorized under an Australian Financial Services Licence to offer retail investors regulated exposure to the cryptocurrency market, the firm stated.

Spot Bitcoin ETF applications have been a focus point for the industry lately, particularly in the United States. In recent weeks, the industry has seen spot Bitcoin ETF filings from major financial firms, including Fidelity, Invesco, Wisdom Tree, Valkyrie and the $10 trillion asset management firm BlackRock.

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Two more spot crypto ETFs launch on Australian markets

21shares

Both of the new Australian exchange-traded funds by 3iQ Digital Asset Management will feed from its existing Bitcoin and Ethereum ETFs listed on the Toronto Stock Exchange.

A further two cryptocurrency-backed exchange-traded funds (ETFs) have launched on the Cboe Australia exchange on June 7 bringing the total amount of crypto ETFs available to Australian traders to six.

The Canada-based 3iQ Digital Asset Management (3iQ) launched two spot ETFs, the 3iQ CoinShares Bitcoin (BTC) Feeder ETF and the 3iQ CoinShares Ether (ETH) Feeder ETF.

Both of the Australian funds feed from the firm's Canadian ETFs listed on the Toronto Stock Exchange (TSX), the 3iQ CoinShares Bitcoin ETF, and the 3iQ CoinShares Ether ETF. The underlying assets of the Canadian ETFs are holdings of BTC and ETH held in cold storage by the Gemini crypto exchange.

3iQs funds join the Bitcoin and Ethereum backed funds by 21Shares and Cosmos Asset Management the latter of which saw launch delays in April due to a still-unnamed service provider needing time to support the launch.

Three ETFs, a Bitcoin and Ethereum ETF by 21Shares and a Bitcoin ETF by Cosmos eventually opened to trading in early May becoming the first crypto ETFs in Australia. Cosmos later released an Ethereum-backed fund on May 31.

Much like 3iQ funds, the underlying assets for the Cosmos ETFs are direct investments into the Canadian Purpose Bitcoin and Ethereum ETFs whilst the funds issued by 21Shares are backed by Bitcoin and Ethereum reserves held in cold storage by Coinbase.

A point of difference is that 3iQ boasts is having the lowest expense ratio out of the six, at 1.2%, — 0.05% lower than the 21Shares and Cosmos ETFs each with an expense ratio of 1.25%.

The three original funds by 21Shares and Cosmos had a sluggish start to trading only seeing $1.3 million in volume on the day of launch, far below the estimated $1 billion of expected inflows. The two 21Shares funds received a total of around $936,500 of total inflows, whilst Cosmos’ Bitcoin fund received just over $398,000.

According to data from Cboe at the time of writing, the two 3iQ ETFs have seen a volume of 13,592 and 9,754 shares traded of the Bitcoin and Ethereum ETFs, accounting for around $73,415 and $73,605 respectively to a total of over $147,000, much smaller than its competitors.

Australian stock exchange