Key Points
- Monochrome Asset Management is launching Australia’s first spot Ethereum ETF on Cboe Australia.
- The IETH ETF offers tax efficiency and competitive fee rates through a unique bare trust structure.
Monochrome Asset Management is set to introduce Australia’s first spot Ethereum exchange-traded fund (ETF) on Cboe Australia.
This marks a significant development in the country’s cryptocurrency investment sector.
Monochrome’s Ethereum ETF
The firm’s new Ether ETF, known as IETH, is designed to give Australian investors direct access to Ethereum.
The application for this ETF was filed on 5th September, with approval expected by the end of the month.
Trading of IETH is scheduled to begin on 14th October, following a swift approval process.
This Australian fund differentiates itself globally by offering in-kind Ethereum subscriptions and redemptions, a feature not prevalent in U.S. funds.
Jeff Yew, CEO of Monochrome Asset Management, in an interview, highlighted the unique tax efficiency feature of the IETH.
Unique Tax Efficiency
He explained that the fund’s dual-access bare trust structure is designed to avoid capital gains tax events, providing a strategic advantage for long-term Ethereum holders.
This structure allows investors to transfer their Ethereum into the ETF without a change in legal and beneficial ownership, potentially enhancing the tax benefits of in-kind subscriptions and redemptions.
However, recent data from U.S. ETFs shows contrasting trends: Bitcoin ETFs saw significant inflows, while Ethereum ETFs recorded minor outflows.
Despite these contrasting trends, industry giants such as BlackRock and Fidelity maintain optimism for Ethereum’s potential.
Future Plans and Challenges
Monochrome plans to tap into the growing local interest in crypto investments, aiming to expand its presence as investor enthusiasm continues to build.
The Monochrome Ethereum ETF (IETH) aims to offer Australian investors broad accessibility through major brokerage platforms, supporting crypto exchange and wallet transfers.
With fees set at 0.5%, reduced to 0.21% for accredited advisers, it aligns closely with U.S. market rates.
Therefore, IETH is well-prepared to capture any resurgence in market demand.
