The Australian Securities and Investment Commission (ASIC) has recently joined a growing number of organizations showing an interest in Bitcoin Exchange Traded Funds (ETFs).
The financial regulator noted that bitcoin possesses qualities that satisfy its standards for an ETF.
However, a 46-page consultation report from the Commission published on June 30, reveals some of the concerns the regulator entertains that border around the unique risks associated with crypto-asset ETFs.
As a regulatory body, one among the unsettled issues the commission has with crypto-asset ETFs is the possibility of product issuers making sure that ETFs are adapted within the ASIC checks and balanced framework.
Another concern outlined in the news has to do with issued products meeting the goal of an ETF, these include classifying crypto-assets in line with general asset rules, and reliability of crypto-assets price transparency.
In addition, because the market is still growing, while trying to lay hold on crypto-assets, some retail investors are yet to understand what it takes to invest in, trade, and protect crypto-assets when acquired.
More than that, crypto-assets are highly volatile and as such, investors would prefer to gain access via a well-regulated financial market for security reasons against market manipulation. This was a major reason given by Jay Clayton, the former U.S. SEC chairman.
Other concerns the commission has, boils down to online criminal activities like money laundering schemes and crypto scams.
In the meantime, Australia has only admitted that a Bitcoin ETF is likely to meet regulatory standards, but is yet to launch any at the time being.
Hopefully, in the spirit of the Bitcoin ETF rally and first launch in Canada hitting $1billion in less than two months, other countries are very likely to follow suit if their application is eventually approved.
Meanwhile, several countries have continued to file applications for an ETF launch.