Chinese funds have applied to launch spot bitcoin exchange-traded funds (ETFs) through their Hong Kong affiliates, according to a report from the Chinese state-owned newspaper Securities Times, which cites several institutions as a source.
In the early morning hours of April 10, the Hong Kong Securities and Futures Commission updated the list of virtual asset management fund companies on its official website, adding Harvest International Asset Management Company and China Asset Management (Hong Kong) Co., Ltd. (referred to as China Asset Management). This means that the country’s leading public funds have finally “entered” the virtual asset industry in Hong Kong and are qualified to issue relevant currency fund products.
Compared with the bitcoin-spot ETF in the United States, which can be purchased in legitimate currency, the local bitcoin-spot ETF in Hong Kong has added a bitcoin-spot subscription; that is, investors can subscribe to this type of ETF on the Hong Kong Stock Exchange through legitimate currency, or a compatible currency exchange circle uses bitcoin-spot for subscription. This is the main reason for the delay in the launch of the Hong Kong Bitcoin Spot ETF.
According to Tencent Finance journalists, now that bitcoin is on the rise and the Hong Kong stock market is inactive, bitcoin spot ETFs are something that many traditional institutional investors will be able to channel into their assets. However, compared to the U.S., the Hong Kong bitcoin spot ETF may be about one-tenth the size. Harvest International’s bitcoin-spot ETF is expected to be around US$2 billion.
The Hong Kong unit of China Asset Management, one of the largest asset management companies in China, has also reportedly signed a cooperation agreement with Hong Kong-licensed crypto exchange HashKey to “jointly promote and develop Web 3.0-related initiatives in the asset management industry in Hong Kong.” While a final timeline for the emergence of spot bitcoin-ETFs in Asia has yet to be announced, industry insiders speculate that related filings could appear as early as this quarter.
The momentum for spot cryptocurrency ETFs gained momentum when the SFC and the Hong Kong Monetary Authority issued a joint circular in late 2023 recognizing the growing interest in launching spot cryptocurrency ETFs. While the SFC has allowed licensed crypto providers to offer cryptocurrency futures ETFs in the region, permission for spot ETFs has yet to be granted.
