Australia: tomorrow on the market the first spot ETF on Ethereum

Tomorrow, Tuesday, October 15, 2024, at 10 AM local time, the first spot ETF on Ethereum in Australia will debut on the stock exchange.

It will be the Monochrome Ethereum ETF, which will have the ticker IETH.

The first spot ETF on Ethereum in Australia

Until today on the Australian stock exchanges there was already a spot ETF on Bitcoin, always by Monochrome, but not yet one on Ethereum.

IBTC (Monochrome Bitcoin ETF) has been traded on the Australian CBOE exchange since June, and so far it has reached an AUM of over 15 million dollars.

Tomorrow, the new spot ETF on Ethereum, IETH, will also arrive on CBOE Australia.

IETH is an ETF with a license and direct holding in Australia, and that is why it is the first of its kind on Ethereum. Furthermore, for now, it is the only ETF on Ethereum in Australia that directly holds ETH, eliminating intermediary layers to provide pure exposure to this asset.

In fact, it offers direct exposure to ETH within a regulated framework, and investors can also directly transfer Ethereum, or cash, to and from IETH, which provides them with flexibility and efficiency in managing their investment.

IETH operates according to the strict Australian financial regulations.

Monochrome

Monochrome Asset Management is the CAR (Corporate Authorised Representative) number 1286428 of Vasco Trustees.

He is the investment manager for Monochrome Bitcoin ETF (IBTC) and Monochrome Ethereum ETF (IETH), while Vasco Trustees is the responsible entity and the issuer of interests in IBTC and IETH.

It is a company specialized in investment management, and it offers regulated access to the crypto market.

It is based in Sydney, Australia, and is effectively the leader in the country for the issuance and local management of bull and bear crypto spot ETFs.

The crypto market in Australia and the arrival of the Ethereum ETF

Australia is not a particularly large market for cryptocurrencies.

For example, on Kraken, the daily trading volume of BTC in AUD (Australian dollars) barely exceeds a million dollars, while on the same exchange, the daily trading volume of BTC in Euro almost always exceeds 10 million.

On the other hand, only 26 million people live in Australia, much fewer than the 340 million who live in the Eurozone.

Even the Sydney stock exchange (which is not CBOE Australia) is not very large, because it is even smaller than Zurich’s in terms of market capitalization, and even smaller than Johannesburg’s in South Africa in terms of trading volumes.

CBOE Australia has a daily trading volume that often does not exceed one billion dollars in equities, and the sole daily trading volume of the Monochrome spot Bitcoin ETF often does not exceed $150,000.

It is therefore a smaller market compared to global markets, but it should be remembered that Australia remains a country with several crypto initiatives. Despite this, however, it is not at all among the top positions of the Global Adoption Index by Chainalysis.

The crypto spot ETFs in the world

To all this must be added that there are strong differences between the interest of the markets in relation to spot Bitcoin ETFs, and that for spot ETFs on altcoins, primarily Ethereum.

Taking the USA market as a reference, and the largest Bitcoin ETF in the world (IBIT by BlackRock), it is discovered that it has a daily trading volume around one billion dollars, while the spot Ethereum ETF by BlackRock, ETHA, often does not exceed 50 million.

There is therefore a chasm between the resounding success that the spot Bitcoin ETFs have achieved starting from January on traditional exchanges, and that of the equivalents on Ethereum.

On the other hand, traditional investors tend to be on average more cautious than crypto ones, and this justifies the fact that they are more attracted to BTC rather than ETH or altcoins.

For this reason, the launch of the ETF on ETH by Monochrome in Australia will probably not have any significant impact on the price of Ethereum.