Australia's Financial Watchdog Says Bitcoin ETP Could Create 'Risk,' Seeks Feedback

ASIC said it is attempting to evaluate whether cryptos are appropriate underlying assets for an exchange-traded product.

AccessTimeIconJun 30, 2021 at 3:03 a.m. UTC
Updated Sep 14, 2021 at 1:18 p.m. UTC
10 Years of Decentralizing the Future
May 29-31, 2024 - Austin, TexasThe biggest and most established global hub for everything crypto, blockchain and Web3.Register Now

Australia needs to tread carefully should it eventually launch a crypto exchange-traded product (ETP), the country's financial regulator said Wednesday.

In a consultation paper from the Australian Securities and Investment Commission (ASIC), the regulator is reaching out to market participants for feedback on whether crypto underlying products can meet existing ETP expectations.

ASIC said it is attempting to evaluate whether cryptos are appropriate underlying assets, whether they could be reliably priced, and how they should be classified with respect to underlying asset rules, according to the paper.

The paper seeks feedback in two main areas on how an ETP may affect the market including compliance costs and effects on competition. ASIC's request for feedback comes as the Australian Securities Exchange, one of the country's major bourses, is considering applications for the launch of a domestic ETP by year's end.

"At this point in time, in our view, the only crypto-assets that are likely to satisfy these factors are bitcoin and ether," the regulator said.

How product issuers can ensure these products are compliant with the existing regulatory framework, including with respect to custody, risk management and disclosure were also mentioned for consideration.

In Australia, there are three types of categories that fall under an ETP including exchange-traded funds, managed funds and structured products – a security or derivative which gives financial exposure to the performance of underlying instruments.

"We are aware of interest in, and demand for, domestic crypto-asset ETPs," said the regulator. "However, we are also aware of the real risk of harm to consumers and markets if these products are not developed and operated properly."

Comments need to be submitted to the regulator by July 27 with those wishing to provide feedback having the option to remain anonymous or use an alias.


Please note that our privacy policy, terms of use, cookies, and do not sell my personal information has been updated.

CoinDesk is an award-winning media outlet that covers the cryptocurrency industry. Its journalists abide by a strict set of editorial policies. In November 2023, CoinDesk was acquired by the Bullish group, owner of Bullish, a regulated, digital assets exchange. The Bullish group is majority-owned by; both companies have interests in a variety of blockchain and digital asset businesses and significant holdings of digital assets, including bitcoin. CoinDesk operates as an independent subsidiary with an editorial committee to protect journalistic independence. CoinDesk offers all employees above a certain salary threshold, including journalists, stock options in the Bullish group as part of their compensation.

Learn more about Consensus 2024, CoinDesk's longest-running and most influential event that brings together all sides of crypto, blockchain and Web3. Head to to register and buy your pass now.