Australia’s Securities and Investments Commission (ASIC) has approved its first Bitcoin spot Exchange-Traded Fund (ETF), in a move that is expected to significantly boost crypto adoption in the country. When it comes to APAC countries, Thailand approved its first spot Bitcoin ETF the same day as Australia; Hong Kong approved spot Bitcoin and Ethereum ETFs in April 2024.
“Australia’s move is likely to influence regulators in other countries,” said Jane Smith, a blockchain expert at FinTech Innovations. “We could see a domino effect, with more countries approving Bitcoin spot ETFs and other crypto-related financial products.”
Thailand just approved its first spot Bitcoin ETF.
Australia launched theirs today.
Meanwhile in Europe, it’s a race to the bottom to slash fees with one provider offering zero fees.
Things are about to get real goofy, y’all. pic.twitter.com/r0OGNNEneW
— Fernando Nikolić 🇦🇷 🟠 (@basedlayer) June 4, 2024
The country has one of the highest rates of cryptocurrency adoption globally, ranking 9th out of 26 countries for crypto adoption, according to Finder’s Crypto Adoption November 2022 report, according to cryptonews.com. Per the report, the crypto ownership rate in Australia is 17%, which is higher than the global average of 15%.
However, just last month the Australian Taxation Office (ATO) initiated a comprehensive Australia crypto tax crackdown, demanding personal and transaction data from up to 1.2 million crypto exchange accounts.
This crypto tax crackdown development marked a pivotal moment in regulatory efforts to ensure tax compliance and transparency in the rapidly evolving digital currency landscape.
The Role of Regulatory Framework
The introduction of a Bitcoin spot ETF is expected to attract a broader range of investors, including those who have been hesitant to invest in cryptocurrencies due to the complexities and risks associated with direct ownership.
By providing a regulated and familiar investment vehicle, the ETF lowers the barriers to entry and offers a more secure way to invest in Bitcoin. Unlike futures-based ETFs, which are tied to the price of Bitcoin futures contracts, a spot ETF directly tracks the price of Bitcoin. This means that investors can gain exposure to Bitcoin without having to buy and store the cryptocurrency themselves.
The approval process for the Bitcoin spot ETF was rigorous, reflecting the stringent regulatory framework in place to protect investors.
ASIC’s decision was based on a thorough evaluation of the ETF’s structure, including its custody arrangements, pricing mechanisms, and risk management strategies.
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Disclaimer: Crypto is a high-risk asset class. This article is provided for informational purposes and does not constitute investment advice. You could lose all of your capital.
