'Crypto Christmas': Aussie Bitcoiners cheer US ETFs

Australia’s crypto community is cheering — mostly — after the first spot Bitcoin exchange-traded funds were approved in the US, democratising access to the cryptocurrency.

After years of delay and lawsuits, the Securities and Exchange Commission early on Thursday, Australia time, approved the 11 ETFs, including ones by financial giants Grayscale, VanEck, BlackRock and Fidelity.

The approval means investors and institutions will be able to access Bitcoin exposure by buying a fund traded directly on a regulated share market like the New York Stock Exchange, rather than to use a more loosely regulated cryptocurrency exchange.

John O’Loghlen, the Sydney-based APAC managing director of Coinbase, called it a pivotal step forward for the transition towards digital assets.

“The announcement will not only pave the way forward for greater innovation for current crypto users but opens the door to millions of new investors through highly regulated and convenient products,” he said.

Caroline Bowler, the chief executive of Melbourne-based exchange BTC Markets, said the SEC’s decision provided greater context for the Australian Securities Exchange to list a spot Bitcoin ETF, as the Australian exchange is expected to do in the first half of this year.

“This further opens cryptocurrency to both retail and institutional investors via a traditional financial product,” Ms Bowler said.

“It is also reasonable to assume that this will expand crypto markets in general, as liquidity follows utility.”

Bitcoin rose as high as $US47,650 ($69,000) on Thursday following the approval, close to a two-year high.

Liam Bussell, chief marketing officer at Melbourne-based fintech the CloudTech Group, agreed that the Bitcoin ETFs could serve as a price catalyst.

The price of gold has grown fivefold since the approval of gold ETFs in 2003, and a conservative estimate is that the ETFs were responsible for 20 to 30 per cent of that, Mr Bussell said.

Australians with self-managed mutual funds that can traded US stock through their broker will be able to invest in the ETFs, he added.

“This is a significant number of Australians,” Mr Bussell said, adding that large super funds may even eventually follow suit once it’s seen as acceptable.

“For those Australians who jumped over the crypto hurdle early, they woke up this morning feeling like it was Crypto Christmas,” he said.

But not everyone was thrilled with the approval. Queensland-based crypto influencer and educator Michael Sloggett was content to play Grinch, saying enthusiasts needed to be careful what they wished for.

“I think people cheering for this isn’t what Bitcoin was meant for, and definitely not something people (will) truly want when they understand what it all really means,” he said.

Bitcoin, he said, “wasn’t meant to make the rich get richer. The ETF is how the top of town rip the eyeballs out of the masses on fees; they don’t care about the asset at all”.

Many die-hard Bitcoin buffs stick to the maxim “not your keys, not your coins” - the belief that one’s crypto is only safe if an individual safeguards it themselves. An ETF, they say, misses the point of crypto and its ability to self-custody one’s assets.