The Securities and Futures Commission (SFC) of Hong Kong approved the applications for Bitcoin and Ethereum spot ETFs yesterday, marking further recognition of cryptocurrencies in the mainstream financial market. The current market is eagerly awaiting the opening of trading for these ETFs, and OSL CEO Wayne Trench stated that, barring any unexpected circumstances, investors will be able to purchase Bitcoin spot ETFs by the end of April.
Yesterday, the Securities and Futures Commission (SFC) of Hong Kong approved the applications for Bitcoin and Ethereum spot ETFs, further promoting the mainstream adoption of cryptocurrencies. The initial institutions to launch these ETFs include Hong Kong-based CSOP Asset Management, Huatai-PineBridge Fund Management, and Bosera International with HashKey Capital. The market is currently anticipating the official opening of trading.
Regarding the listing time for the Ethereum spot ETF, OSL CEO Wayne Trench pointed out that the specific duration is currently uncertain. According to several CEOs of licensed and applying exchanges in Hong Kong, the time gap for the launch could be a few weeks or even a month.
Another aspect of great market concern is how much incremental capital these ETFs will bring to the cryptocurrency market. Katie He, Head of Products and Strategies at Huatai-PineBridge Fund Management, expressed optimism, stating that there will be significant demand for these upcoming virtual asset spot ETFs. She explained that in Hong Kong, only professional investors can invest in US-listed spot ETFs, which will generate greater interest among general investors for local spot products.
However, Bloomberg ETF analyst Eric Balchunas poured cold water on the enthusiasm, tweeting that one should not expect too much capital inflow. He stated that attracting $500 million would already be quite good. He provided four reasons to support his viewpoint: Hong Kong’s ETF market is relatively small, with only $5 billion; mainland Chinese residents are likely unable to purchase these products, at least not openly; the three approved issuers (Bosera, Huatai, CSOP) are relatively small, with no giants like BlackRock involved; and the liquidity or efficiency of the underlying ecosystem is low. Additionally, management fees are expected to be high compared to those in the US.
Although some believe that the upcoming Hong Kong spot ETFs may attract Chinese mainland investors through southbound funds, this viewpoint is controversial as southbound funds currently do not allow mainland investors to invest in Hong Kong’s cryptocurrency futures ETFs, let alone spot cryptocurrency products.
OSL’s Director of Regulatory Affairs, Gary Tiu, responded positively to this, stating that the approval of the Hong Kong spot ETFs is a significant step forward.
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