Thomas Daniels
Hong Kong’s financial regulators are on the cusp of approving the first exchange-traded funds (ETFs) for Bitcoin and Ethereum, marking a significant milestone in the cryptocurrency sector of Asia. Bloomberg reports that the announcement could come by April 15, establishing Hong Kong as the pioneer in Asia’s cryptocurrency ETF market.
The first approvals are likely to be granted to an international division of China’s Harvest Fund Management Co. and a collaborative effort between Bosera Asset Management (International) Co. and HashKey Capital. These approvals are pending final verifications.
Pending final endorsement from the Securities and Futures Commission (SFC) and completion of listing agreements with Hong Kong Exchanges & Clearing Ltd, both asset management firms aim to launch their ETFs by the end of April. This follows recent SFC approvals allowing Harvest and China Asset Management to oversee funds linked to digital assets. The introduction of spot Bitcoin ETFs in the U.S. earlier this year revitalized the cryptocurrency markets, hinting at the significant impact Hong Kong’s entry could have on this financial product category.
In the U.S., following SEC approval in January, spot Bitcoin ETFs amassed over $59 billion in assets, contributing to Bitcoin achieving a new peak in March. As a key player in the Asian market, Hong Kong could similarly influence the Bitcoin and Ethereum markets upon ETF approval.
Looking ahead, the London Stock Exchange is poised to introduce Bitcoin and Ethereum exchange-traded notes (ETNs) in May, which offer similar benefits to ETFs. These instruments will simplify the process for institutional investors to engage with cryptocurrencies, eliminating the need for direct acquisition, storage, and security management.
