KEY POINTS
Kazakhstan is set to launch Central Asia’s first spot Bitcoin exchange-traded fund (ETF), with Astana-based Fonte Capital introducing its physically-backed product on the Astana International Exchange (AIX). The Fonte Bitcoin Exchange Traded Fund OEIC, trading under the ticker BETF, is scheduled to go live on August 13, offering regional and international investors regulated exposure to Bitcoin custodied by the U.S.-based firm BitGo.
Fund Structure and Security
Unlike exchange-traded notes (ETNs) that track an asset’s price through derivatives, the BETF directly holds Bitcoin, ensuring each share is physically backed by the underlying cryptocurrency. This structure is designed to provide greater transparency and security for investors.
Custody for the fund’s assets is managed by BitGo Trust, a U.S.-regulated custodian known for its institutional-grade security protocols. The holdings are insured for up to $250 million and are secured using offline cold storage and secure vaults, measures intended to mitigate risks associated with hacks and counterparty failure.
A Regulated Haven in Central Asia
The BETF operates under the regulatory oversight of the Astana International Financial Centre (AIFC), a financial hub that has actively worked to establish a comprehensive legal framework for digital assets. The AIFC’s regulations allow licensed crypto exchanges, custodians, and investment products to operate within its jurisdiction, aiming to create a secure and attractive environment for digital finance.
This progressive stance positions Kazakhstan, already one of the world’s largest Bitcoin mining centers, as the most crypto-friendly market in the region. Neighboring countries like Uzbekistan and Kyrgyzstan have adopted more cautious regulatory approaches, leaving Kazakhstan to pioneer regulated crypto investment products in Central Asia.
Kazakhstan Joins Global ETF Trend
The debut of BETF aligns Kazakhstan with a growing list of major jurisdictions, including the United States, Canada, and Hong Kong, that have approved spot Bitcoin ETFs. The launch provides a simplified access point for both institutional and retail investors, allowing them to gain Bitcoin exposure through a traditional stock exchange without the complexities of managing private keys or using unregulated crypto platforms.
Fonte Capital, which registered with the AIFC in 2022, stated the fund is designed to give investors a straightforward way to add Bitcoin to a portfolio. The company emphasized that the product offers “a high level of control and reliability” while aiming for a low total expense ratio and minimal tracking error against Bitcoin’s price.
The launch of the BETF marks a significant milestone for Kazakhstan’s financial sector, bridging the gap between traditional finance and the digital asset economy. By offering a regulated, physically-backed Bitcoin product, the country reinforces its ambition to become a key hub for crypto innovation and investment in the region and beyond.
