Australian crypto regulators join their counterparts in Canada in embracing the idea of regulating retail investment funds holding crypto assets.
Canadian regulators were the first to embrace the idea. Australian Security and Investment Commission (ASIC) later published a consultation paper on exchange-traded products (ETPs) and other retail platforms that exposure crypto assets.
The launch of bitcoin-based ETFs on the Toronto Stock Exchange attracted a lot of attention globally. ASIC noted that similar products exist in Australia and could pose a real risk to consumers if not properly developed and operated.
Among the issues highlighted in the paper include whether crypto-based investments can meet the requirements like other convectional funds. They also seek to determine whether crypto-assets can be priced reliably. Or whether the existing funds’ rules can be applied.
The paper also took into consideration issues related to custody, risk management, and disclosure. ASIC further noted that the same issues were also considered by regulators in the US and Canada. In a statement, ASIC commissioner Cathie Armour insisted that market regulators and product issuers should be mindful of meeting regulatory requirements when creating and trading their products. ASIC is expected to publish the final recommendations by the third quarter of the year.