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Good morning everyone,

A new Bitcoin ETF was listed in Australia this week.

Brisbane-based asset manager Monochrome launched its spot Bitcoin ETF IBTC on Tuesday.

IBTC was listed on the CBOE Australia exchange, which is the little brother of the Australian Securities Exchange (ASX) in terms of trading volume.

There was some controversy over whether IBTC was "Australia's first spot Bitcoin ETF".

EBTC, the Bitcoin ETF from Global X 21Shares, has been trading on CBOE Australia since 2022.

Monochrome says its IBTC is the first ETF to hold Bitcoin directly.

But some in the industry think that's just marketing.

In my opinion, it doesn't really matter.

Yet another Bitcoin ETF highlights the popularity of the product.

And while I wrote a couple of weeks ago that hard money is eating the world, it may actually be ETFs that are eating the world.

The US approved Bitcoin ETFs in January.

Hong Kong approved Bitcoin (and Ethereum) ETFs in April.

Thailand approved a Bitcoin ETF this week.

Australia just approved a second Bitcoin ETF and is expected to approve more this year. US asset manager VanEck has filed to launch a Bitcoin ETF on the country's largest exchange, the ASX.

Clearly, the Bitcoin ETF train is nowhere near the end of its journey.

DISCLAIMER: This newsletter is not financial advice. It does not take into account your financial situation, is general in nature, and is for educational purposes only.

Also, this newsletter contains affiliate links. This means that I may receive a commission from them. But for Crypto Down Under, I only choose products I use myself and can recommend wholeheartedly. Don’t forget to do your own research.

How the American Bitcoin ETFs are pushing up the price

The 10 US Bitcoin ETFs have had a strong few weeks again.

As of Wednesday this week, they were on a 17-day streak of inflows, with USD 890 million pulled in on Tuesday alone. The record daily inflow was set on 12 March at USD 1 billion, just before Bitcoin hit a new all-time high.

Since their launch in January, the ETFs have attracted a total of more than USD 15 billion, despite the massive outflows in GBTC.

The rule of thumb is: When there are inflows, the price of Bitcoin tends to rise.

Since the launch of the American Bitcoin ETFs, they've seen total inflows of more than USD 15 billion. The price of Bitcoin has risen about 52% over this period.

How the macro environment is changing

The Bank of Canada was the first major central bank to cut rates this week, by 25 basis points. The European Central Bank is also widely expected to cut rates this week. At the time of going to press, the news wasn't out yet.

Canada's rate cut marks the beginning of the end of a global tightening cycle, and sooner or later more central banks will jump on the bandwagon, including the US Federal Reserve. That means more liquidity will flow into risk assets such as equities and crypto. And that will push prices higher.

We also have a US presidential election coming up in November. According to the chart below from Morgan Stanley, between 1928 and 2016, there have only been four US presidential election years in which the stock market fell.

Notably, the declines occurred around catastrophic events such as the Great Depression, the start of World War II, the bursting of the dotcom bubble, and the global financial crisis. Presidential elections tend to boost markets.

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How the perfect storm is building

There's no such thing as a foolproof forecast, and the next geopolitical crisis could be just around the corner. (Hopefully not!)

But the combination of the Bitcoin halving, the ETFs, the political shift in Washington I talked about last week, plus the macro tailwinds and the presidential election, looks to me like the ingredients for a big bull run.

As Matt Hougan, Chief Investment Officer at Bitwise, says, it's kind of an everything, everywhere, all at once situation.

What I’m doing right now

I've shared in this newsletter my plan to rotate about a quarter of my Bitcoin portfolio into real estate next year when Bitcoin hits USD 130,000. I invest in Bitcoin for the long haul and am only prepared to rotate it into real estate and maybe a dividend stock portfolio.

However, I know that altcoins can outperform Bitcoin in certain market phases. That's why I opened small positions in five altcoins earlier this week because I believe they have the potential to outperform Bitcoin over the next year. I'm not getting married to any of these positions. I will be out of all of them in a year's time.

So far in this newsletter I've focused a lot on Bitcoin because I think it should be the building block of any crypto portfolio. Let me know if you want to know more about how I build my portfolio and how I allocate in early bull markets like this one.

Have a great weekend everyone!

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