Kazakhstan has achieved a significant milestone by launching the first spot bitcoin exchange-traded fund (ETF) in Central Asia, known as the Fonte Bitcoin Exchange Traded Fund OEIC (BETF).
- The fund will commence trading on August 13 at the Astana International Exchange (AIX), being priced in U.S. dollars.
- Each BETF share is directly backed by bitcoin, with custody managed by BitGo Trust, which insures assets up to $250 million.
Kazakhstan has emerged as a major player in bitcoin mining following China’s ban on the industry in 2021. With low-cost energy from coal and favorable regulations, it has attracted numerous mining operations.
Unlike exchange-traded notes, the BETF offers a unique structure by holding actual bitcoin; this arrangement is designed to enhance security through measures like cold storage.
This fund is regulated by the Astana International Financial Centre (AIFC), crafted to protect assets and establish a legal framework for digital assets. Notably, neighboring countries like Uzbekistan and Kyrgyzstan have adopted more conservative stances, leaving Kazakhstan positioned as the leading choice for crypto investment in Central Asia.
The launch of the BETF reflects Kazakhstan’s ambition to bolster its financial sector by attracting foreign investment and engaging with the global digital economy, while its structure promotes low costs and stability in tracking bitcoin’s value.
Investors, both local and international, can now participate without the complexities of managing private keys or navigating crypto exchanges.
