A few days ago, Australian asset management and advisory services firm Monochrome Asset Management became the first in the country to obtain an Australian Financial Services License (AFSL) from the regulator to create a crypto exchange-traded fund (ETF) Monochrome Bitcoin ETF under the ticker IBTC.
Jeff Yew CEO of Monochrome Asset Management in an interview with Cointelegraph announced that this is a major milestone for the local market, given that till now crypto ETFs in the Australian market had to operate under asset authorization, holding cryptocurrencies only indirectly.
IBTC, under its AFSL licence, will be able to directly trade and hold tokens under Australian Securities & Investments Commission (ASIC) authorization. This will allow for more independent capital management. It will also provide the opportunity to directly influence the market and facilitate active investing. The latter is not a breakthrough for IBTC, which is intended to be a fund that invests rather passively, but for more aggressive asset managers it could open up a range of new opportunities.
The new license also offers investors greater capital protection, based on ASIC 705 regulations - these include appropriate benchmarking against the spot price and depository arrangements in line with Australian regulations.
"The regulator’s approval of this license variation represents a major step forward for both the advice industry and retail investors, allowing advisers to meet the market demands of their clients when it comes to the nascent crypto-asset class," - Jeff Yew said in a press statement.
"Investors investing in Monochrome’s ETFs will know that their funds are investing directly in Bitcoin (BTC) and Ethereum (ETH), and importantly within the regulatory rails established by ASIC specifically for crypto-assets," - added the CEO, reassuring investors that they will not end up with just one crypto ETF.
ETFs are instruments that could appeal especially to conservative and long-term investors. This could mean an opportunity for the market to see an influx of capital from a new class of investors who, through their investment perspective, can stabilize a highly volatile market.
Today, most cryptocurrencies are seeing little daily price movement. As of 11:00 GMT+3, BTC is gaining 0.08% and ETH is losing 0.25%. Ethereum yesterday crossed the 10-day moving average and appears to be approaching the 20-day moving average, while BTC is already below the 20-day moving average.
Rafał Tworkowski, Junior Market Analyst, Conotoxia Ltd. (Conotoxia investment service)
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