#今日市场观点

Table of contents

  • Hong Kong takes an important step forward

  • Expect a lot of traffic

  • Challenges compared to the United States

Hong Kong is preparing to launch a series of cryptocurrency exchange-traded funds (ETFs) aimed at replicating the success of the United States, pointing the way for Hong Kong's journey to become a hub for crypto assets. A HashKey spokesperson said that spot Bitcoin and Ethereum ETFs may be launched before April 30. Although Hong Kong currently seems to be following the United States, it seems to be leading the way in terms of spot Ethereum ETFs.

Hong Kong takes an important step forward

China's leading asset management company has entered the final stages of launching spot Bitcoin and Ethereum ETFs, which are expected to start trading at the end of April. As such, the ETFs are scheduled to launch on April 30. The launch of these ETFs is expected to rival the rapid success of the U.S. Bitcoin Fund, which gathered $56 billion in assets in three months.

For more than a year, Hong Kong has been competing with global peers such as Singapore and Dubai to create a favorable regulatory environment for the cryptocurrency asset industry. The development is aimed at revitalizing Hong Kong's status as a modern financial center.

Expect a lot of traffic

Demand for these upcoming ETFs will be an indicator of Hong Kong’s progress in the space. Potential sources of demand include Chinese wealth held in Hong Kong, as well as active cryptocurrency exchanges and market makers in the Asia-Pacific region.

Rebecca Sin, ETF analyst at Bloomberg Intelligence, estimates that the funds could have $1 billion in assets under management within two years.

Challenges compared to the United States

However, unlike their U.S. counterparts such as BlackRock and Fidelity Investments, potential issuers in Hong Kong lack global recognition. Given the small size of Hong Kong’s financial sector, the absence of a “BlackRock effect” could dampen expectations for ETF demand.

Although the US Securities and Exchange Commission has reluctantly allowed ETFs to invest directly in Bitcoin, Hong Kong has preliminarily approved spot Bitcoin and Ethereum funds. In addition, unlike the cash redemption model in the United States, the physical subscription and redemption mechanism proposed by HashKey Capital and Bosera provides efficiency and arbitrage opportunities.

According to a HashKey spokesperson, Boshi-HashKey Capital’s spot products are scheduled to start trading on April 30. Although Hong Kong’s total assets are significantly lower than U.S. products, it already allows ETFs based on cryptocurrency futures.