The SEC’s approval of Bitcoin ETFs have significant implications for the Australian financial market. Many Australian investors can already invest in the new 11 ETFs, with trading platform Nabtrade already providing access and CommSec reportedly not far behind.
It is also anticipated that similar products will be made available on the Australian Securities Exchange (ASX). The ASX, Australia’s largest and most influential exchange, is critical in shaping investment trends and opportunities for domestic investors. Brisbane-based Monochrome Asset Management is set to launch a spot Bitcoin ETF on the ASX this year, and the SEC’s recent decision could fast-track the approval of their application. If approved, it marks a significant step in aligning Australia with the global trend of integrating cryptocurrencies into the traditional financial system.
The developments in the US and the potential introduction of a Bitcoin ETF on the ASX signify a turning point for investors in Australia and worldwide. This shift offers new investment opportunities and indicates a growing alignment of Australia’s financial market with global trends, acknowledging the rising prominence of cryptocurrencies as a legitimate, mainstream investment asset.
Nevertheless, the risks of crypto are not wholly eliminated by the SEC’s approval and the use of less-volatile ETFs as an investment vehicle. As investment house Morningstar points out, over the past five years, Bitcoin’s standard deviation or dispersion of returns is nearly four times that of the US stock market.
While much of Bitcoin’s recent volatility has been in the upward direction, this is not always the case. Past successes do not guarantee future returns—especially when it comes to cryptocurrency.
Related: Top 10 Cryptocurrencies To Invest In For Australians
This article is not an endorsement of any particular cryptocurrency, broker or exchange nor does it constitute a recommendation of cryptocurrency or CFDs as an investment class. Cryptocurrency is unregulated in Australia and your capital is at risk. Trading in contracts for difference (CFDs) is riskier than conventional share trading, not suitable for the majority of investors, and includes the potential for partial or total loss of capital. You should always consider whether you can afford to lose your money before deciding to trade in CFDs or cryptocurrency, and seek advice from an authorised financial advisor.
