Hong Kong to Launch New Bitcoin and Ethereum ETFs

Hong Kong is gearing up to introduce new Bitcoin and Ethereum Exchange-Traded Funds (ETFs) tomorrow at 9:30 a.m. EDT, with an anticipated higher initial trading volume compared to the United States.

Zhu Haokang, head of digital asset management and family wealth at Huaxia, expressed confidence in the trading scale of the Hong Kong virtual asset spot ETF on the first day of listing, aiming to surpass the U.S.’s first-day trading volume of $125 million across ten Bitcoin spot ETF issuers earlier this year.

The upcoming ETFs in Hong Kong will offer unique features not found in U.S. counterparts, including the ability for in-kind redemptions and subscriptions, as well as the flexibility to conduct transactions in multiple currencies such as Hong Kong dollars, U.S. dollars, and RMB. Additionally, these ETFs will support wallet-to-wallet transfers, making them more appealing to a global audience.

Wayne Huang, the OSL ETF Project Lead, highlighted the strong regulatory framework in Hong Kong that backs these initiatives. He noted that Hong Kong could lead the world in launching an Ethereum spot ETF, citing the clear guidelines from the China Securities Regulatory Commission regarding the classification of cryptocurrencies like Ethereum as non-securities.

While mainland Chinese investors are currently unable to participate in these ETFs, investors from Hong Kong and other regions, including international, institutional, and retail investors, are eligible to do so.

The operational processes in the Hong Kong market, such as physical subscriptions and stringent anti-money laundering measures, are setting a new standard in the cryptocurrency ETF space. Huang emphasized that physical subscription is an innovative step for Hong Kong ETFs, outlining the secure transfer of digital assets through approved brokerage firms.

As the crypto investment outflows reach a 3-week streak with $435 million, the launch of these new Bitcoin and Ethereum ETFs in Hong Kong is poised to attract significant attention from investors looking to diversify their portfolios.

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