As crypto markets tumble, three crypto-focused exchange-traded funds (ETFs) picked a tough day to start trading on local exchange Cboe Australia today.
The trio’s launch marks the first crypto ETFs to go live in Australia, with two focusing on offering exposure to Bitcoin (BTC) and the other to Ether (ETH).
So far, the three ETFs have generated more than $1.3 million between them, and it’s been estimated that they could see around $1 billion in inflows in the future.
The Cosmos Purpose Bitcoin Access ETF (CBTC) from Sydney-based crypto investment firm Cosmos Asset Management offers a relatively indirect route to BTC, as it “roughly tracks the performance of unhedged USD-denominated currency ETF units (PURPOSE units ETF) in the Purpose Bitcoin ETF.
The other two ETFs were developed by ETF Securities in partnership with leading Swiss exchange-traded product (ETP) provider 21 Shares. The funds are called Bitcoin ETF (EBTC) and Ethereum ETF (EETH). They both track the Australian dollar (AUD) value of their respective assets.
According to data from Cboe at the time of writing, 21 shares of EBTC and EETH saw 125,271 and 142,206 shares trade hands, representing approximately $519,874 and $416,663 in volume, respectively.
Cosmos Asset Management’s fund got off to a relatively slower start at 51,572 shares traded for a total of $398,135. However, activity may pick up soon, given that the company waived fees on the CBTC for two months to pique institutional interest.
Speaking at the launch with Cointelegraph, ETF Securities Head of Distribution Kanish Chugh noted that while the launch was difficult amid the crashing crypto market, it also offers investors a chance reasonable to have a little skin in the game:
“Given the current volatility in the short-term markets, it will be difficult to determine how Bitcoin and Ether will perform. What we are seeing, however, is that Bitcoin is losing more than 50% from its 2021 high, investors are viewing the current volatility as providing them with an opportunity to invest.
“Our crypto ETFs are physically backed and track the underlying price of Bitcoin and Ether and we have high hopes that EBTC and EETH will be a long-term success,” he added.
In a public announcement, ETF Securities Chairman Graham Tuckwell also highlighted the importance of launching crypto ETFs in a local context, given the stature of BTC and ETH.
“The market capitalization and trading volumes of these two major cryptocurrencies are now larger than any company listed on Australian exchanges, but investors have been unable to access them in a regulated manner,” he said. -he declares.
However, not everyone was so optimistic despite the historic moment, as Kraken’s Managing Director for Australia, Jonathon Miller, hailed this “significant milestone for the maturation of the digital asset space” while emphasizing that investors could already buy Bitcoin:
“However, this is not necessarily a watershed moment for accessibility. We must remember that individual investors can already buy Bitcoin directly, and every layer of abstraction away from the underlying asset can add risk and cost.