Exchange-traded funds provider ETF Securities is launching two funds in an Australian first, allowing people to invest in Bitcoin and Ethereum.
The ETFS 21Shares Bitcoin ETF (Code: EBTC), and ETFS 21Shares Ethereum ETF (Code: EETH) will list on Cboe Australia (formerly Chi-X) next week.
They will both track the price of the respective cryptocurrency in Australian dollars and is backed by bitcoin and ether held in cold storage by Coinbase.
ETF Securities has partnered with European fund manager 21Shares, which has been managing cryptocurrency exchange traded products since 2018, for the funds.
ETF Securities Australia Executive Chairman Graham Tuckwell said both EBTC and EETH give investors a way of trading cryptocurrency in a tightly regulated environment, without the need to establish and maintain their own bitcoin or Ethereum wallets, or manage the risks.
“Once we decided to build a range of crypto ETFs for the Australian market, there was only one partner we wanted to work with, and that’s 21Shares,” he said.
“Its pioneering approach to secure investment in cryptocurrency has been emulated by other fund managers around the world,”
ETF Securities Head of Distribution Kanish Chugh says bitcoin has been the best performing asset over the past 10 years and ether has been one of the top ones over the past five years.
“They may be used as an alpha tilts or side bets in a portfolio. They can also be bought as portfolio diversifiers, as they are completely different asset and uncorrelated to shares, bonds and commodities,” he said
Chugh said via EBTC and EETH overcomes the pitfalls of the cryptocurrency market, including low exchange quality, weak custody arrangements, vulnerability to hacking and the loss of private keys and passwords.
The net asset value of EBTC and EETH units is calculated by multiplying the coin entitlement of every unit by the price of underlying cryptocurrency as measured by CryptoCompare at 3pm Central European Time, converted into Australian dollars.
21Shares CEO Hany Rashwan said they were please to offer the first direct exposure Bitcoin and Ethereum ETF in Australia.
“Australian investors clearly want and deserve an affordable, easy, and professional way to access the growing crypto asset class and we’re delighted to continue building accessible bridges into the crypto world,” he said.
“We’re starting with Bitcoin and Ethereum but have even more exciting plans for Australian investors”.
Both ETFs are expected to list on the Cboe exchange on April 27.