Hong Kong’s Securities and Futures Commission (SFC) became the latest jurisdiction to approve Bitcoin and Ether Spot ETFs on April 15 2024 seen as part of efforts to establish a regional crypto hub.
The ETFs, managed by:
- China Asset Management
- Harvest Global
- Bosera and
- HashKey
are expected to draw in some $25 billion from mainland Chinese investors, even though none of the products has a launch date as of now.
“A likely approval of Hong Kong-listed Bitcoin Spot ETFs could attract several billion dollars of capital as mainland investors take advantage of the Southbound Connect program, which facilitates up to 500 billion RMB (HK$540 billion and $70 billion] per year in transactions,” Matrixport, a Singapore-based crypto services provide said in a report.
“Based on the (potential) available capacity, this might result in up to 200 billion Hong Kong dollars of available capacity for those HK Bitcoin ETFs – or $25 billion,” Matrixport added.
Southbound Stock Connect allows qualified mainland investors to trade eligible shares listed in Hong Kong. The ETFs could also attract regional investors who do not want to bother with US accounts and tax forms, experts say.
Just to be clear, all this is clearly positive for bitcoin as it opens up more avenues to invest, I'm just sayying its child's play vs US. Also long-term some of this could go away: more liq, tighter spreads, lower fees and bigger issuers involved. But short/medium term we have…
— Eric Balchunas (@EricBalchunas) April 15, 2024
No official announcement regarding the ETFs has been made by the SFC, as none have received official approval yet. The conditional approval grants applicants permission to proceed with preparations for offering the funds, including applying to the Hong Kong Exchanges and Clearing (HKEX) to list them on the local stock exchange.
The SFC, which introduced regulations for spot crypto ETFs in December 2023, was widely anticipated to grant approval for spot bitcoin ETFs this week. By also approving spot Ether ETFs, Hong Kong becomes the first market in Asia and the first global financial hub to authorize such a product.
In contrast, the US Securities and Exchange Commission (SEC) approved spot bitcoin ETFs in January 2024 but has postponed a decision regarding similar Ether products.
🇺🇸 MILESTONE | ‘We Do not Approve Nor Endorse Bitcoin,’ Says United States SEC as it Approves 11 Spot #Bitcoin ETFs
This development represents a historic milestone in the integration of Bitcoin into traditional financial markets.
Below are the 11 approved products.… pic.twitter.com/Zn41cG9Ji0
— BitKE (@BitcoinKE) January 11, 2024
Since the US started allowing spot Bitcoin ETFs this year [2024], they have seen more than $200 billion in trading volume, and have driven the price of Bitcoin to new highs.
BITCOIN | ETFs Demand Outweighing Supply as #Bitcoin Price Crosses $60,000
While 900 bitcoins are produced daily, the newly issued US Bitcoin ETFs are demanding an average of 2,800 bitcoins per day.https://t.co/0FsmdMyjqw pic.twitter.com/OJQURonLUy
— BitKE (@BitcoinKE) February 29, 2024
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