Hong Kong Poised to Greenlight First Bitcoin ETFs in April, Insider Sources Reveal
Hong Kong is poised to become Asia’s first city to offer spot bitcoin exchange-traded funds (ETFs), with the first approvals expected as early as next week, according to sources familiar with the matter. This accelerated timeline for approval marks a significant development, surpassing industry expectations of launches later in the year.
Regulators in Hong Kong have expedited the approval process, reflecting the city’s efforts to enhance its attractiveness as a global financial trading hub amidst challenges such as pandemic-related restrictions, China’s economic slowdown, and tensions between China and the United States. The introduction of bitcoin ETFs in Hong Kong is seen as a move that could attract fresh global investment and further drive cryptocurrency adoption.
The United States launched the first U.S.-listed exchange-traded funds tracking spot bitcoin in January, drawing significant investor interest with approximately $12 billion in net inflows, according to data from BitMEX Research. Bitcoin itself has experienced substantial growth this year, appreciating by over 60% and reaching an all-time high of $73,803 in March.
Several mainland Chinese and Hong Kong-based asset managers, including China Asset Management, Harvest Fund Management, and Bosera Asset Management, have reportedly submitted applications to launch spot bitcoin ETFs. While the Hong Kong Securities and Futures Commission (SFC) and the companies involved have declined to comment, it’s notable that the Hong Kong units of China Asset Management and Harvest Fund Management recently obtained approval to manage portfolios investing more than 10% in virtual assets.
Despite cryptocurrency trading being banned in mainland China, offshore Chinese financial institutions have shown interest in participating in crypto asset development in Hong Kong. Hong Kong approved its first ETFs for cryptocurrency futures in late 2022, with the CSOP Bitcoin Futures ETF being one of the largest, witnessing a significant increase in assets under management since its launch. Additionally, Hong Kong-based Value Partners is exploring the possibility of launching a spot bitcoin ETF, further indicating the growing interest in cryptocurrency investment products in the region.
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