Australia is set to get its first bitcoin exchange-traded fund (ETF) after a report suggested the country’s clearinghouse, ASX Clear, confirmed that four market participants agreed to meet its stringent margin requirements.
ASX Clear Margin Requirements
An Australian clearinghouse controlling access to the country’s equity markets, ASX Clear, is set to approve a bitcoin exchange-traded fund (ETF), according to a report. Approval of what is said to be Australia’s first bitcoin ETF became possible after three institutional participants and one retail participant agreed to the clearinghouse’s margin requirements.
According to an AFR report, the four participants agreed to provide ASX Clear’s required margin of 42% before it allowed trading in the ETF. The report said this requirement was needed in order to cover the settlement risks that are associated with bitcoin.
“We are now at our minimum number of clearing participants and that means we are ready to go,” explained Hamish Treleaven, CEO of ASX Clear.
The CEO added that the clearinghouse will consequently issue a notice that gives market participants seven days’ notice of ASX Clear’s regulatory approval. The notice, according to the report, is intended to give brokers, clearers, investors and market makers time to prepare for the ETF.
Cosmos Asset Management’s bitcoin ETF will be the only bitcoin ETF product available when trading begins on the Cboe trading platform on April 27, according to the report. It is expected that $1 billion will be poured into the bitcoin ETF once it goes public.
The Regulator’s About-Face
Meanwhile, the report noted that the approval of the bitcoin ETF had come some two years after the Australian Securities and Investments Commission (ASIC) ruled out listing a crypto ETF in the country. However, the regulator would later shift its position after it was pressured by the country’s politicians, the report said.
As noted in the report, Cosmos Asset Management’s bitcoin ETF approval likely means that other trading platforms such as NSX might also list a bitcoin ETF.
