Monochrome to launch Australia's first Spot Ethereum ETF

Monochrome Asset Management is preparing to launch Australia's first Spot Ethereum exchange-traded fund (ETF) on the CBOE exchange following approval of the asset in the US market.

The Monochrome Ethereum ETF (IETH), which begins trading on Monday 14 October, will offer Australian investors a new way to access cryptocurrencies.

New service details

“Monochrome hosted a private event in Sydney this week with our service providers, team and partners to celebrate the upcoming launch of the Monochrome Ethereum ETF,” the company said in an Oct. 11 post on X. I made it.

IETH is accessible through most intermediary platforms in Australia and supports transfers from crypto platforms as well as decentralized wallets and cold storage wallets. Similar to its US competitors, the product tracks the CME CF Ethereum reference rate and has a competitive management fee of 0.5%, with a discounted rate of 0.21% for certified advisors.

The asset manager has secured top industry players for the launch of IETH. BitGo and Gemini will provide crypto custody services, while State Street Australia will act as the fund administrator.

The launch of the Spot Ethereum ETF follows the company's introduction of the Spot Bitcoin ETF in June. Since then, the ETF has attracted investments of $15 million (US$10.1 million), which is small compared to US numbers.

Unique tax benefits with dual access structure

Monochrome has been preparing to launch IETH since September and believes its structure will set its ETF product apart from its international peers.

This new fund will be the first in the world to offer physical Ethereum subscriptions and redemptions. In a recent interview with Decrypt, the company's CEO Jeff Yew emphasized that this feature could have tax benefits for investors. “'Bare Trust' means that an investment in the ETF may be treated as if it directly owns Ethereum,” he explained.

Yu further added that US crypto ETFs, including the Spot Bitcoin ETF, cannot provide physical support and do not operate within the same time zone.

The Spot Ethereum ETF uses a dual access bear trust structure to protect against capital gains taxes for long-term holders. This allows you to transfer your Ethereum to an ETF without changing ownership and avoid any immediate tax liability.

The new service is also said to give investors absolute rights to their allocated Ethereum, ensuring that any action by the trustee on the asset is taken on behalf of the customer. This avoids being subject to capital gains tax during transfer or redemption as long as ownership does not change.