First Spot Crypto ETFs in Australia Underwhelm Traders Amid Market Downturn

A Bloomberg analyst called the debuts “shockingly timid” compared to similar 2021 launches in Canada

article-image

Blockworks exclusive art by axel rangel

share

key takeaways

  • The Australia spot bitcoin and ether ETFs launched by ETF Securities and 21Shares marked trading volumes of $656,000 and $415,000, respectively, on their first day
  • Industry watchers say big investors on the hunt for crypto ETF exposure already bought similar products in Europe or Canada


The first spot bitcoin and ether ETFs in Australia launched Thursday amid widespread crypto market sell-offs, leading industry watchers to note their lower trading volumes compared to similar debuts in Canada. 

The 21Shares Bitcoin ETF (EBTC) and the ETFS 21Shares Ethereum ETF (EETH) booked trading volumes of $656,000 and $415,000, respectively.

EBTC and EETH, which track the price of bitcoin and ether in Australian dollars, are fully backed by respective digital assets held in cold storage by Coinbase. Each fund had roughly $9 million in assets at the end of Thursday.

Meanwhile, the Cosmos Purpose Bitcoin Access ETF (CBTC) invests in crypto through Purpose Investments’ Bitcoin ETF (BTCC), which launched on Canada’s Toronto Stock Exchange in February 2021. CBTC traded about $454,000 in total daily volume Thursday.

Though a 21Shares spokesperson told Blockworks that the EBTC and EETH took “the lion’s share of trading” in Australia on Thursday, Bloomberg Intelligence Senior ETF Analyst Eric Balchunas called the debut “shockingly timid” in a tweet — especially compared to BTCC.  

On the first day of trading, the non-currency hedged BTCC.B and BTCC.U traded $209 million (CAD) and $52 million (USD), respectively, according to a Purpose Investments spokesperson.

Canada-based Purpose Investments’ Bitcoin ETF — the world’s first such product backed by physically settled bitcoin — crossed $1 billion (CAD) of assets a month after its February 2021 debut. The 3iQ CoinShares Bitcoin ETF, which launched in Canada in April the same year, reached $1 billion (CAD) after just three weeks on the market.

The Australian launches come as bitcoin’s price recently dipped below $28,000 for the first time since 2020. It traded around $29,000 at about 2 pm ET on Thursday according to Blockworks data — down 27% in a week. Ethereum’s price stood at about $1,960, down roughly 33%.

The crypto markets have also been rattled in recent days by the depegging of TerraUSD (UST) from the US dollar. UST traded around 37 cents Thursday afternoon.   

“Crypto was and is a bull market plaything for most investors, [especially] the kind that would use an ETF for exposure,” Balchunas tweeted. “Bigger fish to fry for them [right now]. The die hard hodl-ers more likely own direct. That said, long-term these prob take root after next big rally.”

Dave Nadig, financial futurist at ETF Trends and ETF Database, told Blockworks he was not surprised by the trading volumes for the newcomer ETFs. 

“Given that most investors of size can trade on whatever market they like…coming to market with products already available on larger exchanges is going to most likely draw only small local investor interest,” Nadig said. “If you were a hedge fund, you wouldn’t be waiting for [Australia] to launch. You’ve already bought in the EU or [Canada] if you needed exchange-listed exposure.”

Still, Nadig added, spot crypto launched in the US would be “a different animal.” 

The SEC has not approved any of the spot bitcoin ETF proposals it has reviewed. But the US’ first-ever bitcoin futures ETF, the ProShares Bitcoin Strategy Fund (BITO), became the second-highest ETF ever in opening day volume when it launched in October, trading nearly $1 billion.


Get the day’s top crypto news and insights delivered to your email every evening. Subscribe to Blockworks’ free newsletter now.


Want alpha sent directly to your inbox? Get degen trade ideas, governance updates, token performance, can’t-miss tweets and more from Blockworks Research’s Daily Debrief.


Can’t wait? Get our news the fastest way possible. Join us on Telegram and follow us on Google News.


Tags

upcoming event

MON - WED, MARCH 18 - 20, 2024

Digital Asset Summit (DAS) is returning March 2024. This year’s event will be held in our nation’s capital, where industry leaders, policymakers, and institutional experts will come together to discuss the latest developments and challenges in the ever-evolving world of cryptocurrency. […]

upcoming event

MON - WED, SEPT. 11 - 13, 2023

2022 was a meme.Skeptics danced, believers believed.Eventually, newcomers turned away, drained of liquidity and hope.Now, the tide is shifting and it’s time to rebuild. Permissionless II is the brainchild of Blockworks and Bankless. It’s not just a conference, but a call […]

recent research

Curve's Stablecoin and Lending Market

Research

AMMs are at the root of everything elegant and useful in DeFi.That's why Curve put LLAMMA at the center of its lending protocol.

/

article-image

Despite MiCA’s passage, both ESMA and Europe’s Systemic Risk Board want to ensure crypto is regulated and investors are protected

article-image

Bloomberg found that nearly half of crypto companies recently surveyed receive audit services from Deloitte, EY, PwC or KPMG

article-image

Hong Kong is “rich in tycoons and well-capitalized family offices that could fund crypto firms moving into the city,” Matrixport’s head of research told Blockworks

article-image

Lummis originally made critical comments of the Biden Administration’s tax on bitcoin miners at Bitcoin Miami, but retweeted an article summing up her views on Thursday

article-image

Starbucks Odyssey is the company’s Web3 rewards beta program, which is currently only available to select individuals

article-image

Coinbase demanded that the SEC offer clarity on crypto regulation