Hong Kong Securities and Futures Commission (SFC) has officially announced the first batch of approved Bitcoin and Ether spot ETFs and announced that they will be listed and traded in Hong Kong on April 30. As Hong Kong has always been a financial hub in Asia, this ETF approval brings new momentum to the cryptocurrency market.
“ETF” refers to Exchange Traded Funds, which are funds that track major indices or bond market indices. Cryptocurrency spot ETFs directly track the spot prices of Bitcoin and Ether. In simple terms, it lowers investment barriers, allowing investors to participate in the cryptocurrency market and make investments through ETFs.
According to the official announcement on the SFC’s website, the first batch of ETFs includes Bitcoin and Ether spot ETFs applied by Huatai (Hong Kong), CSOP International, and Bosera International. They were all approved on April 23 and are expected to be listed and traded on the Hong Kong Stock Exchange on April 30.
Huatai Bitcoin ETF
Huatai Ether ETF
Bosera HashKey Bitcoin ETF
Bosera HashKey Ether ETF
CSOP Bitcoin Spot ETF
CSOP Ether Spot ETF
This is the first time such products have been launched in the Asian market, with the Ether spot ETFs being the first globally. These spot cryptocurrency ETFs, compared to cryptocurrencies, are more regulated, listed on traditional exchanges, and managed by professional fund companies, providing retail investors and institutions with safer and more convenient ways to invest in cryptocurrencies.
It is worth noting that, unlike the “cash mode” of the Bitcoin spot ETF in the United States, the ETFs in Hong Kong adopt a “physical redemption mechanism”, allowing investors to directly use Bitcoin or Ether for subscriptions and redemptions. This not only enhances investment flexibility and market transparency but also provides investors with more diversified opportunities for digital asset investments.
What do industry experts say?
Eric Balchunas, an ETF analyst at Bloomberg Intelligence, also posted on the X community platform, stating that the average management fees of these funds are lower than previously expected, at 30 basis points, 60 basis points, and 99 basis points, respectively.
James Seyffart, another ETF analyst at Bloomberg Intelligence, also pointed out that there is an ongoing “fee war” among issuers, as CSOP announced full fee waivers before its launch. The reduced minimum fee can reach 0.3%, lower than the 0.6% management fee of Bosera Fund and the 0.99% management fee of Huatai Fund.
Bosera Fund also released a document stating that the management fees for “Bosera HashKey Bitcoin ETF” and “Bosera HashKey Ether ETF” will be temporarily waived from April 30 to August 31 this year to attract more users.
After the approval of the Bitcoin spot ETF by US regulators, the investor base for Bitcoin has expanded, and it has gained dominance in the cryptocurrency market. These funds have accumulated net inflows of over $12 billion, driven by the global asset management giant BlackRock, helping Bitcoin reach a new all-time high of over $73,000.
Although the cryptocurrency spot ETFs listed in Hong Kong may make it easier for global investors to access cryptocurrency assets, Vetle Lunde, a senior analyst at K33 Research, believes that the impact may not be as significant as in the United States, as the scale of capital flows is still relatively smaller compared to the United States.
For example, according to the website of China Asset Management Corporation, as of the end of last year, Huatai (Hong Kong) had assets under management of only $266 billion, while CSOP Global had assets under management of $207 billion. Compared to the $9.1 trillion managed by BlackRock and the $1.64 trillion managed by Franklin Templeton, there is indeed a significant gap.
However, with the official listing of Bitcoin and Ether ETFs in Hong Kong, it will still bring new opportunities and momentum to the Asian cryptocurrency market. Hong Kong’s position as an Asian financial center will be further consolidated, attracting more investors and capital inflows into the cryptocurrency market.
References:
Coindesk, Cointelegraph