Crypto Analytics

First Spot Crypto ETFs In Australia Overwhelm Traders Amid Market Downturn

  • The Australian spot bitcoin and ether ETFs, launched by ETF Securities and 21Shares, saw trading volumes of $656,000 and $415,000, respectively, on their first day
  • Industry watchers say big investors chasing crypto ETF exposure have already bought similar products in Europe or Canada

Australia’s first spot bitcoin and ether ETFs launched Thursday amid widespread crypto market sell-offs, prompting industry watchers to note their lower trading volume compared to similar debuts in Canada.

The 21Shares Bitcoin ETF (EBTC) and ETFS 21Shares Ethereum ETF (EETH) recorded trading volumes of $656,000 and $415,000, respectively.

EBTC and EETH, which track the price of Bitcoin and Ether in Australian dollars, are fully backed by corresponding digital assets held in cold storage by Coinbase. Each fund had approximately $9 million in assets as of the end of Thursday.

Meanwhile, the Cosmos Purpose Bitcoin Access ETF (CBTC) invests in crypto through Purpose Investments’ Bitcoin ETF (BTCC), which launched on Canada’s Toronto Stock Exchange in February 2021. CBTC traded on Thursday with a total daily volume of about $454,000.

Although a spokesman for 21Shares Blockworks said EBTC and EETH had “taken the lion’s share of trading” in Australia on Thursday, Bloomberg Intelligence senior ETF analyst Eric Balchunas tweeted that the debut was “shockingly tentative” — especially compared to BTCC.

On the first day of trading, the non-currency-hedged BTCC.B and BTCC.U were trading at $209 million (CAD) and $52 million (USD), respectively, according to a spokesperson for Purpose Investments.

Canada-based Purpose Investments’ Bitcoin ETF — the world’s first such product backed by physically settled bitcoins — surpassed $1 billion (CAD) in assets a month after its debut in February 2021. Launched in Canada in April of the same year, the 3iQ CoinShares Bitcoin ETF hit $1 billion (CAD) after just three weeks on the market.

The Australian launches come as Bitcoin’s price recently fell below $28,000 for the first time since 2020. It was trading at around $29,000 as of around 2pm ET on Thursday, according to Blockworks data – down 27% in a week. Ethereum’s price was around $1,960, down around 33%.

Crypto markets have also been rocked by TerraUSD (UST) depegging from the US dollar over the past few days. UST was trading around 37 cents on Thursday afternoon.

“Crypto has been and still is a bull market toy for most investors, [especially] the kind that would use an ETF for exposure,” Balchunas tweeted. “Bigger fish for her to fry [right now]. The die-hard Hodl-ers own rather directly. However, in the longer term, these issues will take hold after the next big rally.”

Dave Nadig, chief investment officer and director of research at ETF Trends and ETF Database, told Blockworks he wasn’t surprised by the trading volumes of the newcomer ETFs.

“Given that most large investors can trade in any market they wish, launching products that are already available on larger exchanges will most likely attract little local investor interest,” Nadig said. “If you were a hedge fund, you wouldn’t wait [Australia] start. Have you already bought or sold in the EU? [Canada] if you needed a listed exposure.”

Still, Nadig added, US-launched spot crypto would be “a different beast.”

The SEC has not approved any of the spot bitcoin ETF proposals it has reviewed. But the US’s first-ever bitcoin futures ETF, ProShares Bitcoin Strategy Fund (BITO), when it launched in October, became the second-highest-ever ETF in opening-day volume, trading nearly $1 billion.


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The First Spot Crypto ETFs in Australia Underwhelm Traders Amid Market Downturn post is not financial advice.


Source: Crypto News Austria

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