The first Australian cryptocurrency exchange-traded funds (ETFs) began trading on May 12, and many industry watchers consider this to be a significant turning point for the digital assets market in Australia, if not globally.
Speaking with CNBC, Graham Tuckwell of (ETF) Securities discussed on May 18, the recently launched crypto ETFs in Australia. These ETFs are listed on the CBOE Exchange and fully backed by assets held in cold storage, while tracking the Australian dollar price of Bitcoin and Ethereum, respectively.
Tuckwell said in the interview:
“It’s very much like the gold product we launched almost 20 years ago and it lead to all big gold ETFs around the world.”
Asked if there are facilities present, which would potentially even out price swings, Tuckwell explained:
“We’re trying to give people the sort of physical backing of the Bitcoin and Ethereum. We’re certainly not trying to put any derivative overlay on them. We want to give people a securities, which matches 1 to 1 with the underlying investment that they’re trying to get exposure to.”
The reception for the ETFs was muted as global crypto markets were rocked by the collapse of the stablecoin UST.
Elsewhere, Tony Sycamore, senior market analyst for City Index told Bloomberg:
“There are strong signs of capitulation in crypto this week, which often proceeds rebounds. Presuming the recovery gains traction, it will help garner support for the newly listed ETF products along with the continuation of more widespread adoption.”
The ETFs in one sense offer an easier alternative to getting exposure to crypto for less tech-savvy investors who would like to avoid know-your-customer (KYC) procedures or open up various crypto wallets to have their assets transferred to them.
Time will tell if these products arrived at an opportune time and whether they will usher in an era of crypto ETFs.
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