As a seasoned researcher and investor with a keen eye for innovative financial products, I find the launch of Monochrome’s IETH ETF an exciting development in Australia’s burgeoning crypto market. With my years of experience tracking global financial trends, I can confidently say that this move is reminiscent of the early days of Bitcoin ETFs in the U.S., a move that has since transformed the landscape of digital asset investment.
Monochrome Asset Management is all set to debut Australia’s inaugural spot Ethereum exchange-traded fund (ETF) on the Cboe, with trading commencing on Monday (10 AM AEDT). This launch follows a long-anticipated green light for Ethereum ETFs in the U.S.
As a financial analyst, I recently discovered an exciting development: the introduction of a new Exchange-Traded Fund (ETF) called IETH, which follows closely on the heels of Monochrome’s Bitcoin ETF (IBTC), launched back in August 2023. Since its debut, IBTC has managed to garner an impressive $15 million (US$10.1 million) in investments.
Although IETH’s holdings are relatively small next to the vast sums managed by U.S. ETFs, it distinguishes itself through special attributes such as in-kind subscription and redemption options.
In simpler terms, CEO Jeff Yew outlined how this setup could lead to improved tax advantages for investors. By employing a two-tiered access trust system, the ETF enables long-term Ethereum holders to move their assets into IETH without instigating a capital gains tax scenario. Essentially, he explained that investing in the ETF might be viewed as if you personally own the Ethereum.
With this novel strategy, any moves made by the ETF’s custodian are seen as the investor’s own actions. This means that when the ETF is redeemed or transferred, there will be no capital gains tax liability, as long as the ownership of the investment stays consistent.
Although the Australian market may not replicate the significant investments triggered by the approval of various Bitcoin and Ethereum ETFs in the U.S., Monochrome remains hopeful about the increasing investor attention towards these assets in 2022.
IETH will follow the Asia-Pacific version of the CME CF Ether-Dollar Reference Rate and will impose a management fee of 0.50%, which can be lowered to 0.21% for accredited advisers. This fee structure makes it competitive in the U.S. market, as comparable funds usually charge between 0.20% and 0.25%.
Option: The Exchange-Traded Fund (ETF) can be traded on multiple Australian brokerage sites, allowing transfers from numerous crypto exchange platforms, decentralized wallets, and offline wallets. Custodians for IETH will be BitGo and Gemini, while State Street Australia takes care of the fund management duties.
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2024-10-14 10:29