Monochrome Asset Management Prepares to Launch Australia’s First Spot Ether ETF on Cboe

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October 14, 2024

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Australia’s Monochrome Asset Management is launching the country’s first spot Ethereum exchange-traded fund (ETF). The product, dubbed IETH, will begin trading on Monday on the Australia Cboe exchange.

Last week, the asset manager hosted a private event in Sydney to announce the launch of IETH. The event saw participation from Monochrome’s service providers, team, and partners.

The launch of the spot Ethereum ETF comes three months after a similar launch in the US, which has failed to attract the same demand as spot Bitcoin ETFs.

Besides, Monochrome launched Australia’s first Bitcoin ETF in June under crypto licensing rules. With the ticker IBTC, it offered a new way for Australians to access Bitcoin in a regulated and compliant manner.

The spot Bitcoin ETF product is authorised under a crypto licensing category under the Australian Financial Services Licensing (AFSL) regime.

Monochrome Ethereum ETF Comes With a Twist

Monochrome’s IETH functions as a dual-access fund, allowing cash and in-kind applications and redemptions for investors, per a September announcement.

“The launch of the Monochrome Ethereum ETF will broaden the range of regulated crypto-asset investment options available to Australian investors.”

IETH will passively hold Ethereum, offering retail investors in Australia a regulated opportunity to gain exposure to the second-largest crypto.

Additionally, Monochrome CEO Jeff Yew said that the dual-access ‘bare trust’ function could offer greater tax benefits to investors.

“A ‘bare trust’ means that your investment in the ETF may be treated as if you directly own the Ethereum,” Yew told Decrypt. This means that investors get absolute entitlement to their allocated Ethereum.

Further, any actions by the trustee are treated as those of investors, ensuring that there is no capital gains tax. By doing so, Monochrome aims to differ from its US counterparts.

Monochrome filed the IETH product in September alongside its Responsible Entity partner Vasco Trustees Limited, the announcement added.