Hong Kong's Ether ETFs have experienced a record-breaking surge in daily inflows, likely driven by anticipation of the US SEC's potential approval of similar products. This growing institutional interest has resulted in a significant spike in trade volumes.
Record Inflows for Hong Kong Ether ETFs
The spot Ether exchange-traded funds (ETFs) managed by ChinaAMC saw a substantial increase in daily inflows, surpassing HK$5 million (US$640,780) by mid-day Wednesday. This follows an impressive inflow of HK$3.77 million on Tuesday, marking the largest since the ETF’s launch. The uptick in investment activity comes as investors speculate on potential US approval of similar products. The Tuesday net inflows alone reached HK$3.77 million, showcasing heightened investor interest.
Surge in Crypto ETF Investments in Hong Kong
Hong Kong’s Ether ETFs have recorded their highest daily inflow since their inception, signifying a pivotal moment in the region’s evolving crypto market. On Monday, May 20, Hong Kong’s Bitcoin ETFs also reported positive inflows totaling $6.62 million. These Bitcoin ETFs now hold 3,660 Bitcoins after just 13 days of trading, with total net assets reaching approximately $246 million and a total value traded of $2.78 million.
The spot Bitcoin ETF inflows were led by Bosera & HashKey with $6.29 million (95 BTC), followed by China AMC with $7.09k (0.11 BTC), and Harvest with $321k (4.85 BTC). This notable surge underscores the increasing institutional interest and confidence in Bitcoin ETFs within Hong Kong’s financial markets.
Despite this growth, the turnover of Hong Kong’s spot crypto ETFs has been relatively low on most days since their launch. Compared to the US, where spot Bitcoin ETFs were approved in January and enjoy much higher trading volumes, Hong Kong’s market remains modest. While ETFs are seen as crucial for attracting mainstream investors to volatile virtual assets and potentially boosting prices, the initial impact of Hong Kong’s ETF launches on the global cryptocurrency market has been “muted.” Analysts note that Hong Kong’s ETF market is significantly smaller than that of the US.
Anticipation of US SEC’s ETH Approval and Market Impact
Bloomberg Intelligence ETF analysts Eric Balchunas and James Seyffart recently raised the estimated probability of the SEC approving Ether ETFs from 25% to 75%, indicating a potential shift in the regulatory body’s stance. This development has sparked considerable interest and optimism within the market.
Currently, the price of Ethereum (ETH) stands at $3,748.40, with a 24-hour trading volume of $31.7 billion. This marks a 2.42% price increase over the past 24 hours and a substantial 29.16% increase over the past week. With a circulating supply of 120 million ETH, Ethereum’s market cap has reached $450.3 billion.
The SEC is expected to make a decision on at least one of the Ether ETF applications by May 23. This decision is highly anticipated as it could significantly influence market dynamics and investor sentiment towards Ether ETFs, not only in the US but globally.
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