Updated on April 18, 2024: Hong Kong Bitcoin and Ethereum Spot ETFs officially approved, Chinese investors may be excluded from purchasing?
According to Bloomberg’s report last week, the Hong Kong Securities and Futures Commission is expected to approve Bitcoin Spot ETFs and Ethereum Spot ETFs by the end of April. This news has excited the Chinese cryptocurrency community and garnered international attention and discussion.
Today, at 2:00 p.m., Harvest Global Investments, the applicant for the Hong Kong Bitcoin and Ethereum ETFs, announced that the Hong Kong Securities and Futures Commission has granted preliminary approval for their two digital asset (BTC, ETH) spot ETF products.
Harvest Global Investments stated that their future Bitcoin and Ethereum spot ETF products will collaborate with OSL, the first licensed digital asset platform by the Hong Kong Securities and Futures Commission, to effectively address issues such as high margin requirements, price premiums caused by short supply, and roll-over losses. This collaboration will result in a more accurate reflection of the real-time value of Bitcoin.
By approving the Ethereum Spot ETF ahead of the United States, Hong Kong has not only made a historic milestone but is also expected to see more Bitcoin Spot ETF products launched soon.
However, due to China’s comprehensive ban on all cryptocurrency trading and mining activities in 2021, it is still uncertain whether the Hong Kong ETF will be accessible to Chinese investors.
Analysts from Bloomberg Intelligence pointed out that Chinese investors are likely unable to purchase the Hong Kong Bitcoin Spot ETF.
Wu, a reporter from Blockchain News, also reported that several Hong Kong Bitcoin ETF issuers have revealed that investors from mainland China cannot purchase them using southbound funds.
Furthermore, it will take some time to observe whether the Hong Kong ETF can attract a significant amount of funds to the cryptocurrency market, similar to the situation in the United States.
The following is the original article from April 11, 2024:
Hong Kong expedites the review of four Bitcoin Spot ETFs! Approval possible in April.
After the United States approved the Bitcoin Spot ETF earlier this year, it brought a significant amount of funds to the cryptocurrency market and led to the rise in Bitcoin (BTC) prices. According to Reuters, two sources revealed that Hong Kong’s regulatory authority may approve the first batch of Bitcoin Spot ETF applications next week, with trading potentially starting in April.
️ Further reading:
In-depth analysis of “Bitcoin Spot ETF”! Why are 11 financial giants rushing to apply?
According to local news media Tencent Finance, the Hong Kong Securities and Futures Commission (SFC) has accelerated the review of four Bitcoin Spot ETF applications currently under consideration. These include Harvest Global Investments, China Asset Management, Bosera Funds, and Huili Financial.
The report stated that the SFC urgently updated the list of virtual asset management funds yesterday (April 10) because they plan to announce the first batch of Bitcoin Spot ETFs in Hong Kong by April 15. However, Bosera Funds and Huili Financial are not yet included in the updated list because these two funds do not have independent licensed responsible officers for cryptocurrency asset management.
According to the Hong Kong process, after the SFC releases the first batch of Bitcoin Spot ETFs, the Hong Kong Stock Exchange will need approximately two weeks to prepare for product listing. Due to detailed communication and planning between the Bitcoin Spot ETF project and the Hong Kong Stock Exchange, it is expected to be completed in around 10 days. Tencent Finance stated that the SFC originally planned to list the Bitcoin Spot ETF in Hong Kong around April 25, at the latest by the end of April.
What do experts think about the “Hong Kong version” of the Bitcoin ETF?
This is something that investors can look forward to, as they can use ETFs to invest in Bitcoin, effectively providing retail investors with access to the cryptocurrency market.
Noelle Acheson, a market analyst, also stated, “This will be a big deal” because it also provides Chinese investors with a legal opportunity to access Bitcoin.
Acheson pointed out that Chinese investors’ interest in domestic real estate and stocks is declining because there are issues in the Chinese real estate market, construction industry, and stock market. This, in turn, has sparked investors’ interest in alternative assets such as gold. Recently, an ETF linked to gold in China experienced record-high trading volumes as investors flocked to the asset, leading to a temporary suspension when the price premium reached 30%.
Therefore, if the Bitcoin ETF is indeed approved in Hong Kong, there may be a “large influx of funds into the Bitcoin market.” Additionally, if concerns about the continuous depreciation of the Chinese yuan intensify, investment in Bitcoin will become more widespread.
Acheson also suggested that Chinese authorities may be aware that regardless of approval, most citizens are likely to shift their investments towards hard assets such as precious metals. Therefore, they may prefer investments unrelated to the US economy.
Vetle Lunde, a senior analyst at K33 Research, stated that while the approval of the ETF could act as a catalyst for further Bitcoin development, the scale of fund inflow is unlikely to reach that of US ETFs.
Reference sources: cointelegraph, coindesk, coindesk
Proofread by: Gao Jingyuan
