After the approval of the first Bitcoin and Ethereum spot ETFs in Hong Kong, experts predict that regulatory agencies in other Asian countries such as South Korea, Japan, and Singapore may follow suit and approve ETFs related to virtual assets. South Korea is expected to be the first country to follow suit.
Hong Kong is about to welcome the first Bitcoin and Ethereum spot ETFs, as Huaxia Fund (Hong Kong), CSOP Asset Management, and HashKey Capital have all announced that they have received conditional approval from the Hong Kong Securities and Futures Commission. It is rumored that Bitcoin spot ETF trading will be available as early as April 25.
According to a report by Blockworks, after the conditional approval of Bitcoin and Ethereum spot ETFs by the Hong Kong Securities and Futures Commission, regulatory agencies in other Asian countries may also follow suit. Countries such as South Korea, Japan, and Singapore are expected to emulate Hong Kong and approve ETFs related to virtual assets.
Karim Saber, a researcher at cryptocurrency ETP issuer 21Shares, also stated that the adoption of cryptocurrencies in countries like South Korea, Japan, and Singapore is higher than the average level, indicating that Asia may be at the forefront of approving new Bitcoin spot ETFs.
Furthermore, South Korea held parliamentary elections on the 10th, and the largest opposition party, the Democratic Party of Korea, won a majority of seats, securing an overwhelming victory. Saber believes that the friendly attitude towards Bitcoin from the Democratic Party of Korea increases the possibility of approving Bitcoin spot ETFs in the near future.
In general, Karim Saber expects that the regulatory agency in South Korea will be the first to approve Bitcoin spot ETFs this year, with Japan and Singapore not far behind. Last month, the Government Pension Investment Fund (GPIF) of Japan announced that it is considering investing in assets with lower liquidity, including Bitcoin. The Japanese government also stated in February that it will amend the law to add cryptocurrencies to the list of assets that local investment limited liability partnerships can acquire or hold.
On the other hand, a survey conducted by Australian cryptocurrency exchange Independent Reserve in March found that one-third of Singaporeans are considering investing in overseas Bitcoin spot ETFs. Although the Monetary Authority of Singapore has concerns about retail investors investing in spot ETFs, the adoption of cryptocurrencies in the country continues to develop. For example, Singapore users were allowed to use Bitcoin, Ethereum, and stablecoins for payment on the ride-hailing app Grab last month. Saber believes that this move indicates the integration of cryptocurrencies into mainstream business areas.
Tim Bevan, CEO of cryptocurrency ETP issuer ETC Group, estimates that Japan and South Korea may approve cryptocurrency spot ETF products within the next 6 to 12 months. Although the approval timeline is difficult to predict, these countries are catching up with the United States.
As for Taiwan, mainstream securities firms including Yuanta Securities, KGI Securities, and SinoPac Securities announced at the end of January that, in order to protect investors due to the high price volatility and high risk of virtual currency commodities, they temporarily only accept entrusted selling of foreign securities linked to virtual currency (such as Bitcoin) spot and futures-related products, and do not accept new entrusted buying. The Financial Supervisory Commission (FSC) of Taiwan has requested the Securities and Futures Institute to study the issue, and the results will be available in April this year.
However, legislator Ke Juin-jin questioned that if securities firms are prohibited from acting as intermediaries, it will force the public to buy from overseas securities firms, making it more difficult for the government to monitor the investment situation of the public in Bitcoin ETFs. Securities firms will also lose commission income, and if the public has investment disputes with overseas securities firms, they will have to bear the risk themselves, and may even fall into fraudulent traps and not receive protection, resulting in a three-way loss for the government, securities firms, and the public.