Bitcoin exchange-traded fund [ETF] in Hong Kong has now become a reality after two ETFs overseen by CSOP Asset Management have secured a total of over $73 million ahead of their launch on the Hong Kong stock exchange, notwithstanding the current market instability.
CSOP Asset Management’s ETFs, primarily invest in bitcoin and ether futures which are the only cryptocurrency assets currently permitted by Hong Kong’s Securities and Futures Commission [SFC].
Out of the two, the bigger one called CSOP BTC Futures ETF was able to raise $53.9 million, per the investment firm.
According to media reports, that outperformed ProShares Bitcoin Strategy ETF, the first U.S. bitcoin futures ETF, which made its debut on the NYSE Arca exchange in October 2021 with $20 million in seed money.
”Coming after the recent liquidity problems affecting some of the crypto platforms, our two crypto futures ETFs demonstrate that Hong Kong remains open-minded on the development of virtual assets,” said Yi Wang, head of quantitative investment at CSOP.
”As the ETFs do not invest in physical bitcoin, and are traded on regulated U.S. and Hong Kong exchanges, there are more regulatory safeguards for investors compared to tokens traded on unregulated platforms,” Wang stated.
On Friday, each lot trading on the Hong Kong Exchanges & Clearing [HKEX] will debut at HK$780 each.” The price of bitcoin may be subject to manipulation as a significant portion is held by a small number of holders” and the CME futures could drop to zero, the ETFs’ product document filed to the HKEX said.
The latest development follows the CSOP’s recent approval to list its Bitcoin and Ethereum exchange-traded funds by the SFC of Hong Kong on Dec 16.
Bitcoin And Ethereum ETFs In the Pipeline
A week ago, three asset management firms including CSOP Asset Management submitted their ETF applications to the Securities and Futures Commission or SFC, TronWeekly reported.
The other two AUMs in the race are Samsung Asset Management and Mirae Asset Global Investments.
Once granted approval, bitcoin and ether futures will go live on the Chicago Mercantile Exchange, according to people familiar with the plans.
Despite the FTX contagion that sent a chill across the industry, institutional and retail clients in Hong Kong, mainland China, and Taiwan have shown more interest in investing in cryptocurrency ETFs.