Australian asset manager will sell cryptocurrency ETF via exclusive license variant – Monochrome Asset Management has been granted the first Australian financial services license (AFSL) for a spot cryptocurrency exchange-traded fund (ETF). Jeff Yew, CEO of Monochrome Asset Management, told Cointelegraph that the AFSL clearance is noteworthy since, up until this point, licensed crypto ETFs in Australia only operated under general financial asset authorization and only held crypto-assets indirectly.
Yew highlighted that Monochrome’s crypto ETFs would hold the underlying crypto-assets directly and are explicitly approved to do so by the Australian Securities & Investments Commission (ASIC). The CEO at Monochrome said that the clearance signifies a major advance for both the advising business and retail investors:
We believe that choice is beneficial for investors, especially in regulated markets where not all products are equal. “Investors in Monochrome’s ETFs will be aware that their funds invest directly in Bitcoin (BTC) and Ethereu (ETH), and most crucially, inside the regulatory framework created by ASIC for crypto-assets,” he added.
At present time, there is no set date for the release of the Monochrome Bitcoin ETF (IBTC), but September 2022 is anticipated, pending regulatory approvals and the issuance of the PDS and TMD.
When the ETFs become available, Yew states “Monochrome will concentrate on BTC and ETH since these are the only two crypto-assets that ASIC has deemed as eligible for retail ETF exposure.” “As the industry develops and as time passes, we will adopt an open-minded approach to introducing new items.”
The first first crypto ETF
Yew said that operating under an Australian Financial Services Licence (AFSL) with a direct crypto-asset authorization means the fund and issuer are subject to rigorous ASIC scrutiny. The granting of an AFSL permits additional regulated investment options for ordinary investors and registered financial advisors.
The approval of the Australian Financial Services Licence variation signifies that ASIC has evaluated and determined that the licensee has the necessary crypto-asset knowledge to run ETFs that directly hold Bitcoin and Ethereum. This provides investors with enhanced safeguards based on ASIC’s Report 705, including appropriate benchmarking against the spot price and Australian-compliant custody solutions.
Previously, Cointelegraph reported that Australia’s financial authority issued a warning against utilizing unregistered bitcoin firms.
Road to approval
Former Binance Australia CEO Jeff Yew started Monochrome Asset Management in early 2021 to promote institutional use of crypto assets in Australia. Their ETF strategy has been in development since February 2022. In this instance, the procedure for a financial services license variation was expected to take between six and twelve months.
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