Australia’s First Crypto ETFs Received Lukewarm Receptions Amid Rising Market Volatility

Australia’s First Crypto spot ETFs have witnessed extremely low trading volume since the launch back in the mid of May. On the debut of 21Shares’ spot Bitcoin and Ethereum ETFs, the volume was only around $656,000 and $415,000 respectively.

• The two Crypto spot ETFs in Australia have both been coldly received by investors since they began trading on the Cboe Australia exchange on May 12nd, according to the coverage by Bloomberg.
• The three listed ETFs – Cosmos Purpose Bitcoin Access ETF, ETFS 21Shares Bitcoin ETF, and ETFS 21Shares Ethereum ETF ( tickers: CBTC, EBTC, and EETH) – have all experienced sharp declines in trading volume as the extreme volatility of the crypto market has motivated investors to de-risk, thus avoiding speculative assets.
• CBTC went live on Tuesday, only recording 2,073 exchanged shares on its debut day.
• Noticeably, an overwhelming percentage of the floating shares of the aforementioned products are not being traded in the market as the investors’ sentiment toward crypto-related equities remains low.
• Since their launch, the spot ETFs have been a disappointment in gaining investors’ interest. Bloomberg Intelligence Senior ETF Analyst Eric Balchunas tweeted that the debuts had fallen short of expectations as compared to the first-day volume of Canada’s Bitcoin ETF, CI Galaxy Bitcoin ETF (BTCX).

WOW: shockingly timid debut for the two spot bitcoin and ether ETFs that launched today in Australia. $EBTC did $650k, $CBTC did $311k, $EETH did $414k. None even close to Top 100 list. For context, Canada’s first bitcoin ETF saw DAY ONE volume 250x greater than these guys.

— Eric Balchunas (@EricBalchunas) May 12, 2022

• In addition to the market condition that thwarts the broader enthusiasm toward crypto assets – Financial Review reported – “prohibitively expensive” margin conditions imposed by the country’s main equity capital market watchdog, ASX Clear. It requires participants to pay 42% of the value of each trade as collateral, might have impeded brokers from listing such products.
• In April, 21Shares and its partner ETF Securities delayed the listings of the Bitcoin and Ethereum ETFs due to an undisclosed third-party broker reportedly blocking the products from going live on the Cboe Australia exchange.