DigitalX Gains Approval for Australia’s Second Spot Bitcoin ETF

Blockchain-focused asset manager DigitalX has received regulatory approval to launch its spot Bitcoin exchange-traded fund (ETF), making it the second company to offer a Bitcoin ETF on the Australian Securities Exchange (ASX), following VanEck’s recent approval.

The DigitalX Bitcoin ETF, listed under the ticker BTXX, is set to debut on July 12 at 10 am local time, as announced on July 8.

“Watershed Moment” for DigitalX

DigitalX CEO Lisa Wade described the approval as a significant milestone for both the company and the Australian digital asset investment market.

“We are pleased to now be able to deliver and offer this spot Bitcoin ETF to the Australian market. This is a watershed moment for us as a business and for the Australian digital asset investment market,” Wade said. She emphasized that the ETF provides ASX customers with direct access to Bitcoin through a regulated and liquid fund structure.

DigitalX has partnered with investment management firm K2 Asset Management, which will act as the responsible entity and issuer of the ETF. Additionally, DigitalX will collaborate with cryptocurrency-focused investment firm 3iQ to promote and distribute the product both within Australia and internationally.

Recent Trends and Market Context

The approval comes just over three weeks after the ASX granted approval for VanEck’s spot Bitcoin ETF on June 15, which began trading on June 20. VanEck’s Bitcoin ETF (VBTC) saw a modest volume of $1.3 million on its first trading day, in contrast to the average daily volume of $450 million seen by the nine spot Bitcoin ETFs in the United States during their initial ten trading days.

Another Australian fund manager, Betashares, is also reportedly pursuing a Bitcoin ETF on the ASX, according to an April report from Bloomberg.

Digital Asset Products See Inflows

The approval of DigitalX’s Bitcoin ETF coincides with significant inflows into digital asset investment products. CoinShares, a digital asset and fintech investment business, reported inflows totaling $441 million, driven by investor perception of recent price weakness as a buying opportunity.

While exchange-traded product (ETP) volumes remained relatively low at $7.9 billion, in line with the seasonal pattern of lower volumes during the summer months, inflows into digital asset investment products remained robust. However, the participation rate of ETPs in the total market for trusted exchanges was 17% lower.

Australia’s crypto market has seen significant growth in ownership and adoption, with a crypto ownership rate of 17%, higher than the global average of 15%. Despite this growth, crypto has been under increasing scrutiny in Australia. For instance, in May last year, Binance Australia informed customers of losing access to Australian dollar deposits and withdrawals due to a decision by its third-party service provider. In July, officials from the Australian Securities and Investments Commission (ASIC) conducted searches at Binance Australia’s offices.