Fonte Capital’s Fonte Bitcoin Exchange Traded Fund OEIC (BETF) will begin trading on Aug. 13 on the Astana International Exchange (AIX) in Astana.

The fund is priced in dollars, and it holds Bitcoin directly and uses U.S. custodian BitGo for custody. 

BitGo stores assets offline and in secure vaults and carries insurance of up to $250,000,000.

The move follows years of growth in Kazakhstan’s bitcoin mining industry and aims to give investors a way to buy bitcoin through a regulated exchange without handling private keys.

Fund structure and custody

BETF is set up as a fund that owns actual bitcoin rather than as an exchange-traded note. That means the bitcoin backing shares sit in custody, and BitGo, a U.S.-regulated custodian, will hold the coins. 

The company uses cold storage to limit online exposure. Insuring up to $250,000,000 is meant to ease concerns about hacks or counterparty failure.

Fonte Capital said the fund allows in-kind settlements. The structure is intended to help keep the expense ratio low and reduce the gap between the fund price and the bitcoin market. Shares will trade on AIX, so investors can access them through the exchange instead of using crypto wallets or trading on an unregulated platform.

Why Kazakhstan?

Kazakhstan rose in bitcoin mining after China banned the sector in 2021. Mining operations moved out of China, and many found Kazakhstan attractive. 

The country has cheap, coal-powered electricity and a regulatory approach that has welcomed crypto firms. That mix made Kazakhstan one of the largest bitcoin mining hubs in the world.

The Astana International Financial Centre has created rules for digital assets. It allows licensed exchanges, custodians and investment products to operate under its framework.

Backers say AIFC rules can protect assets from freezes tied to international sanctions and reduce reliance on foreign issuers.

Also Read: Kazakhstan To Launch “CryptoCity” Pilot Zone, Aiming To Make Crypto Payments Familiar

Regional context

Nearby states have taken a slower path, and Uzbekistan and Kyrgyzstan have moved cautiously on crypto. That has left Kazakhstan as the more open market in Central Asia.

For investors in Almaty or London, the new ETF means they can buy bitcoin exposure through AIX without managing private keys.

Source of demand

For Kazakhstan, a regulated crypto product could help bring foreign money into the financial sector. The fund may also support efforts to integrate local markets with the wider digital asset economy. 

Fonte Capital registered with AIFC in 2022 and runs diversified funds. The firm said the ETF offers a simple route to add Bitcoin to a portfolio while keeping a focus on control and reliability.

Practical investor details

The ETF will trade in U.S. dollars on AIX and its design supports in-kind creations and redemptions. That can cut some costs and lower tracking error versus holding Bitcoin directly. 

The custody approach, with offline storage and insured holdings, is aimed at both retail and institutional buyers who worry about hacks and counterparty risk.

Wider implications

BETF’s launch brings Kazakhstan into a list of places that have approved spot bitcoin ETFs, joining countries that already offer similar products. 

In practice, this lets more investors gain regulated exposure to bitcoin without dealing with wallets and exchanges. It could also nudge other regional markets to rethink their rules on digital assets.

Also Read: Kazakhstan Partners with Solana in Strategic Move to Establish a Blockchain-Powered Economic Zone