Kazakhstan, a global leader in bitcoin mining, has made history by launching Central Asia's first spot Bitcoin ETF, marking a significant milestone for the region's cryptocurrency market. The Fonte Bitcoin Exchange Traded Fund (BETF), set to begin trading on August 13 on the Astana International Exchange (AIX), offers investors a regulated, physically backed avenue to invest in Bitcoin.
Key Features of BETF
- Physical Bitcoin Backing: Each BETF share is directly backed by Bitcoin, with custody managed by BitGo Trust, ensuring security and reliability.
- Insurance Coverage: Holdings are insured for up to $250 million, providing an additional layer of security against potential risks.
- Regulated Framework: The ETF operates under the Astana International Financial Centre (AIFC), offering a safeguard against international sanctions and reducing dependency on foreign issuers.
Kazakhstan's emergence as a crypto-friendly jurisdiction is largely due to its abundant coal-powered electricity and favorable regulations, especially after China's 2021 mining ban. This has positioned Kazakhstan as a hub for crypto investment in Central Asia, contrasting with the more cautious approaches of neighboring countries like Uzbekistan and Kyrgyzstan.
The introduction of BETF not only aligns Kazakhstan with global financial markets offering spot Bitcoin ETFs, such as the U.S., Canada, and Hong Kong, but also simplifies Bitcoin investment for both institutional and retail investors by eliminating the need for direct crypto exchange navigation or private key management.
Fonte Capital, the fund's manager, emphasizes BETF's role in providing a straightforward and reliable method for portfolio diversification into Bitcoin, highlighting the fund's low expense ratio and minimal tracking error against Bitcoin's price.
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