Monochrome Asset Management in Australia has announced the launch of the country’s first spot Ethereum exchange-traded fund (ETF) called IETH. The ETF will begin trading on the Australia Cboe exchange on Monday. The launch event for IETH took place in Sydney last week and was attended by Monochrome’s service providers, team, and partners. This launch comes three months after a similar launch of a spot Ethereum ETF in the US, which did not attract the same level of demand as spot Bitcoin ETFs. Monochrome previously launched Australia’s first Bitcoin ETF in June under crypto licensing rules with the ticker IBTC, providing Australians with a regulated way to access Bitcoin.
As a dual-access fund, IETH allows for both cash and in-kind applications and redemptions for investors. This feature will broaden the range of regulated crypto-asset investment options available to Australian investors. Monochrome’s CEO, Jeff Yew, highlighted that the ‘bare trust’ function of the ETF could offer greater tax benefits to investors. This means investors may be treated as if they directly own the Ethereum held by the ETF, giving them absolute entitlement to their allocated Ethereum. Actions by the trustee are considered those of the investors, helping to avoid capital gains tax implications. Monochrome hopes to differentiate itself from its US counterparts by implementing this tax-efficient structure.
Monochrome’s spot Ethereum ETF, IETH, will passively hold Ethereum, providing retail investors in Australia with a regulated opportunity to gain exposure to the second-largest cryptocurrency. The ETF is authorized under a crypto licensing category within the Australian Financial Services Licensing (AFSL) regime. The product filing for IETH was made in September in collaboration with Monochrome’s Responsible Entity partner, Vasco Trustees Limited. By offering a regulated way for Australians to invest in Ethereum, Monochrome is expanding the options available for crypto-asset investments in the country.
The launch of Australia’s first spot Ethereum ETF marks a significant development in the country’s crypto investment landscape. With increasing interest and demand for crypto assets, regulated investment vehicles like ETFs provide retail investors with easier access to the market. Monochrome’s decision to introduce a spot Ethereum ETF comes after the success of its Bitcoin ETF launch earlier this year. By leveraging the dual-access ‘bare trust’ structure, the ETF aims to offer tax advantages to investors, distinguishing itself from similar products in the US. The launch event held in Sydney signals a growing focus on crypto investments in Australia and the importance of regulatory compliance in the sector.
The spot Ethereum ETF from Monochrome represents a milestone in the evolution of Australia’s crypto investment sector. As the country’s first regulated product allowing exposure to Ethereum, IETH opens up new avenues for investors looking to diversify their portfolios with digital assets. The dual-access feature of the ETF, combined with its tax-efficient ‘bare trust’ structure, provides investors with a unique opportunity to participate in the crypto market. With the growing popularity of cryptocurrencies globally, the launch of IETH underscores Australia’s position as an emerging hub for crypto investments. Monochrome’s innovative approach to creating regulated crypto investment products demonstrates the potential for further growth and development in the Australian crypto ecosystem.
