The ASX is scheduled to onboard the first cryptocurrency exchange-traded fund soon.
Crypto finally hitting Australian stock exchanges
There is an abundance of exchange-traded funds (ETFs) on the ASX, such as the highly popular Vanguard Australian Shares Index ETF (ASX: VAS) but also other ETFs for commodities like oil, gold, silver, platinum, palladium, and a slew of others. Even investing in foreign economies is no problem. The ASX lists ETFs for the South Korean economy, the Indian economy, and foreign government bonds. If an investor wants to diversify beyond that, he is more than welcome to do so: ETFs for cash and property exist as well. Curiously, one item is missing on this extensive list, and you can probably already tell which one it is: crypto assets. However, the ASX may just be about to change that.
BetaShares, an ETF provider, published an announcement of its first-ever crypto-based ETF launch on the ASX. The fund is going to be called the BetaShares Crypto Innovators ETF and will have the ticker code “CRYP.” However, the ETF will not be directly investing in cryptocurrencies like Bitcoin or Ether but rather in “global companies driving the rapidly growing crypto economy.” That is similar to US-based ETFs that can invest in companies with crypto exposure but not in cryptocurrencies as such.
CRYP will “aim to track an index comprising a focused portfolio of more than 30 leading crypto innovators”, including Coinbase Global Inc, Riot Blockchain Inc, and MicroStrategy Incorporated. BetaShares would let you speculate on the people selling the shovels but not on the gold itself, so to speak. The company voiced concerns over complications that an ETF directly related to crypto-assets might entail, which is why it is focusing on investments in companies providing “crypto mining equipment, crypto trading venues, and other key services that allow the crypto economy to thrive.”
Crypto ETFs are coming
This announcement comes at a time where the SEC has approved the first Bitcoin ETF in the US, something that crypto bulls have been calling for for years. Still, for Australia it is mostly good news and signals that there is, after all, a will to give investors exposure to cryptocurrencies and embrace the emerging sector. News in recent weeks has been mostly mixed, with leading crypto exchange Binance being forced to close its derivatives section for Australians over regulatory concerns. On the other hand, senator Andrew Braggs came forward with a statement saying that Australia should become a crypto hub and that it was still not too late for the country to become a hub and influence the future direction of the crypto market.
With crypto ETFs in the United States starting to be approved and crypto-adjacent ETFs launching on the ASX, the pressure for Australian regulators is on. Regulatory guidance is needed if the country is to take a leading role in crypto adoption. Otherwise, Australia will most likely be a spectator in the inevitable rush into cryptocurrencies in the future.