Australia’s Inaugural Bitcoin ETF Begins Trading

The cryptocurrency market is buzzing with the news that the Monochrome Bitcoin ETF, poised to be Australia’s first spot Bitcoin ETF, will begin trading today. This pioneering ETF will directly hold Bitcoin, signifying a major milestone in the nation’s financial landscape.

Monochrome Asset Management has announced that its Bitcoin ETF (IBTC) will commence trading on June 4th, barring any last-minute delays. The ETF, which will trade under the ticker IBTC, will have a management fee of 0.98%.

Monochrome Asset Management is offering this fund to provide investors with regulated exposure to Bitcoin. The ETF will track the CME CF Bitcoin Reference Rate index, offering exposure directly linked to Bitcoin’s spot price.

Cboe will become the first Australian exchange to list a Bitcoin ETF, outpacing the larger Australian Securities Exchange (ASX). However, reports indicate that the ASX plans to approve spot Bitcoin ETFs before the end of the year.

These launches capitalise on the increasing interest spurred by the regulatory approval of Bitcoin ETFs in the US market this January, which attracted significant inflows from both institutional and retail investors.

Our very own Imperial Wealth/Mining Store team was able to attend the private launch party!

Australia already has several exchange-traded products offering Bitcoin exposure, but Monochrome Asset Management is the first to receive approval under a new crypto asset licensing category established in 2021 under Australian Financial Services (AFS) licensing rules.

This approval allows the ETF to hold Bitcoin directly. Monochrome stated that IBTC’s holdings are stored offline in a device not connected to the internet, using a crypto custody solution that meets “Australian institutional custody regulatory standards.”

“Before IBTC, Australian investors were only able to invest in ETFs that indirectly hold Bitcoin or through offshore Bitcoin products, both of which don’t benefit from the investor protection rules under the directly held crypto asset AFS licensing regime,” Monochrome explained in a statement.

Unlike its US counterparts, which are cash-settled, this ETF permits in-kind redemption from investors.

Monochrome CEO Jeff Yew said in an interview that he expects “strong interest” in the firm’s ETF, given the steady growth of indirect Bitcoin ETF products in recent months.

He confirmed that the firm is “ready” to build and launch an Ether ETF, which will also hold the asset directly.

“We are also exploring other thematic opportunities within the digital asset sector to meet investor demand,” he added.

This year has seen the launch of regulated Bitcoin ETFs across North America, the UK, Europe, and the Asia-Pacific region. Australia’s entry into this market highlights the growing acceptance of Bitcoin as an institutional asset class.

Other countries are expected to follow suit, with major markets now offering spot Bitcoin ETFs. The regulated framework lends legitimacy and offers investors an accessible way to gain exposure to Bitcoin.