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Hong Kong’s Awaited Launch of Bitcoin and Ethereum ETFs
Anticipation is high in Hong Kong as the debut of the city’s first spot Bitcoin and Ethereum ETFs draws near. Reports from local media outlets on April 29 suggest that the trading volumes expected during the launch could surpass those seen in similar events in the United States.
Huaxia Fund Management (Hong Kong) and digital asset service provider OSL are leading the way in launching these ETFs, which are scheduled to be available on the Hong Kong Stock Exchange on April 30. In a press briefing conducted prior to the launch, Zhu Haokang, Huaxia’s head of digital assets, expressed strong confidence in the potential of these ETFs. Zhu projected that the trading volume on the first day could exceed the $125 million recorded during the debut of spot Bitcoin ETFs in the US in January.
“We anticipate setting a new record for a crypto ETF debut in Hong Kong,”
Zhu also highlighted the robust interest shown pre-launch, emphasizing that the ETFs offer options for both cash and physical redemptions, a feature not commonly found in the US market. Wayne Huang from OSL emphasized the preparedness of operations, mentioning that a significant amount of funds had been mobilized in anticipation of the launch. He noted that pre-market transactions implied strong demand that is expected to continue into the official trading day.
These ETFs, the first in Asia to offer spot trading of Bitcoin and Ethereum directly through an exchange, aim to attract local and international investors with more flexible investment mechanisms compared to their US counterparts. The launch is considered a crucial moment for Hong Kong’s digital assets market, positioning the city as a leading global financial hub in the digital assets sector.
Both Huaxia and OSL highlighted the regulatory clarity and innovative trading features of their products as key factors expected to drive success and appeal to a diverse investor base. This includes regions without existing crypto ETFs, such as Singapore and the Middle East.
However, some analysts predict that the Hong Kong-based Bitcoin ETFs may not see inflows exceeding $1 billion in the first year. This projection is based on market size considerations and the restriction preventing mainland Chinese investors from participating in these ETFs.
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