Australian regulators seek public input on crypto ETPs

Gordon James


Buy and Sell Crypto

The Australian Securities and Investments Commission (ASIC) is seeking public input on proposals to regulate and license crypto-specific exchange traded products (ETPs). According to a media release issued on 8 August 2018, ASIC is developing a proposed framework that will provide a consistent and clear regulatory environment for crypto ETPs.

The Australian Securities & Investments Commission has called for public input in its review of two crypto exchange-traded products (ETPs)—a cryptocurrency fund and a crypto index.

The Australian Securities and Investments Commission (ASIC) has recently announced it will be seeking public input on whether a new type of exchange-traded product (ETP) should be regulated, and if so under what conditions. The announcement follows a public hearing held by ASIC on the issue.. Read more about cryptocurrency etf list and let us know what you think.

The Australian Securities and Investments Commission (ASIC) is seeking public input on cryptoasset exchange-traded products (ETPs) and says it is aware of the growing interest and demand for their introduction on Australian regulated markets.

In a consultation document published on 30… In June, the regulator said its top priority was to assess whether the unique and evolving characteristics of crypto asset ETPs could consistently meet existing regulatory obligations. Given this complexity and the rapid pace of change in the sector, ASIC says there is a need for a broad consultation to assess the two key issues on the agenda:

(a) whether these products can meet existing expectations for ETPs, including whether cryptoassets are suitable underlying assets, whether cryptoassets can be reliably valued, and how cryptoassets should be classified with respect to underlying asset rules; and (b) how product issuers can ensure that these products comply with our regulatory framework, including with respect to custody, risk management, and disclosure.

ASIC’s document states that given its assessment of the maturity of the spot industry and the level of regulation of its futures market, the regulator does not believe that all crypto assets can currently serve as suitable underlyings for ETPs. However, the regulator is open to approving FTEs for crypto assets that can meet all its relevant assessment criteria. Here explains the controller :

Currently, in our opinion, the only crypto assets that can meet these factors are bitcoin (BTC) and Ether (ETH).

ASIC’s move appears to have been prompted both by the recent listing of Ethereum ETPs on the Toronto Stock Exchange – which ASIC specifically mentions in its paper – and by the Australian Securities Exchange’s (ASX) ongoing review of several cryptocurrency ETP applications.

In recent months, ASIC has increasingly reached out to domestic blockchain and cryptocurrency companies in an effort to build trust and cooperation with the crypto economy. However, the regulator has been criticized by some of these companies for the perceived lack of transparency in existing cryptocurrency regulation and compliance obligations.

In its statement, ASIC points out that the classification and regulation of crypto assets is a matter for the government, even in Australia. The Senate Select Committee on Australia is currently considering options for a comprehensive regulatory framework for cryptocurrencies and digital assets, and ASIC stresses that its paper does not seek to pre-empt any decision the committee may make.

Related: VanEck and BetaShares are calling for an Australian cryptocurrency ETF, while family offices are buying BTC.

Audience reactions are expected on the 27th. July at ASIC. Respondents can choose to answer openly, anonymously or under a pseudonym.

Speaking to Cointelegraph, BetaShares founder and CEO Alex Vinokur responded to ASIC’s question about the desirability of offering retail investors access to ETPs’ underlying crypto assets through a licensed Australian marketplace. Vinokur said BetaShares, as a local provider of ETPs and other funds traded on the ASX, believes this approach offers consumers better protection than direct access through the exchanges.

Vinokur also agreed with the suggestion that regulated investment products such as ETPs should be limited to a small subset of crypto assets that can demonstrate reliable liquidity, transparency and pricing.

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