According to a recent Reuters report, Hong Kong will become the first city in Asia to launch Bitcoin spot ETFs. Notably, initial approvals for these ETFs are expected to be announced next week, significantly exceeding industry expectations for these types of launches this year.
The revival proposed by Hong Kong
According to the report, the decision to introduce spot Bitcoin ETFs comes as Hong Kong seeks to revive its status as a preeminent financial center, in which pandemic-related restrictions have been somewhat eased, China’s economic slowdown and tensions between China and the United States.
By adopting cryptocurrency investment vehicles, Hong Kong aims to attract new global investments and take cryptocurrency adoption to new heights.
Adrian Wang, CEO of Metalpha, a Hong Kong-based crypto asset manager, emphasized the importance of introducing Bitcoin ETFs in Hong Kong, noting the potential for greater global investment and broader adoption of cryptocurrencies.
This move follows the success of the United States, which launched the first US-listed spot Bitcoin ETFs in January and attracted approximately $12 billion in net inflows, as Bitcoinist previously reported.
While the Hong Kong Securities and Futures Commission (SFC) and the three Chinese firms declined to comment, the Hong Kong units of China Asset Management and Harvest Fund Management recently obtained approval from the SFC to manage portfolios with investments greater than 10% in virtual markets. asset.
These parent companies are major mutual fund companies in China, each managing more than 1 billion yuan ($138 billion) in assets.
Bitcoin Futures Success Fuels Interest in Spot Bitcoin ETFs
Cryptocurrency trading is prohibited in mainland China. However, Chinese offshore financial institutions have shown great interest in participating in the development of crypto assets in Hong Kong.
The city had already approved ETFs for cryptocurrency futures in late 2022, with the CSOP Bitcoin Futures ETF being the largest. It has accumulated around $120 million in assets under management, up sevenfold since September 2023.
In addition to the aforementioned asset managers, Hong Kong-based Value Partners has expressed its exploration of launching a spot Bitcoin ETF, although it has not revealed whether an official application has been filed.
Additionally, at least four asset managers from mainland China and Hong Kong, including China Asset Management, Harvest Fund Management and Bosera Asset Management, have filed applications to launch Bitcoin spot ETFs.
As the regulatory landscape evolves, the introduction of spot Bitcoin ETFs in Hong Kong is expected to pave the way for greater investment opportunities and contribute to the growth and maturation of the global cryptocurrency market.
At the time of writing, the market-leading cryptocurrency has witnessed significant price volatility. It approached its all-time high on Monday and hit a high of $72,600. However, it encountered upper level resistance, falling towards the $67,600 range. This represents a 3.5% reduction in the last 24 hours alone.
