Chinese firms propose Bitcoin ETFs in Hong Kong

Chinese investment firms, Harvest Fund and China Southern Fund, are pushing for spot Bitcoin ETFs in Hong Kong. This comes as a surprise amidst the declining interest in American spot Bitcoin ETFs. This move indicates increasing interest in the cryptocurrency space. Both firms have set things in motion, with Harvest Fund proposing a Bitcoin ETF spot to the Hong Kong Securities and Commission. This major leap suggests a growing acceptance of Bitcoin ETFs in Asia. Meanwhile, China Southern Fund is also submitting their application. The Hong Kong-based branch of China Asset Management, in collaboration with a Bitcoin ETF custodian, anticipates approval of their applications by the second quarter of 2024. Considering Harvest Fund and China Southern Fund’s assets stand at $230 billion and $280 billion respectively, this could create a significant change in the industry. Despite reports of declining interest in digital assets, investments in US-approved spot Bitcoin ETFs are on the rise. This demonstrates a robust investor appetite, defying any apparent market disillusionment.

Hong Kong Bitcoin ETF proposals by Chinese firms

Exchange-traded funds are now being considered a reliable option in a volatile crypto environment. Hong Kong is aiming to become a cryptocurrency hub with China potentially softening its stance on cryptocurrencies. The applications from Harvest Fund and China Southern Fund could prove bullish. The Hong Kong Monetary Authority is even investigating the feasibility of a digital Hong Kong dollar. Despite potential progress, uncertainties loom with the ending of Hong Kong’s legislative freedom under the “One Country, Two Systems” policy with China in 2047. The subsequent transition to complete control by mainland China might invite stricter regulations and restrictions, undermining the growth of the digital currency industry in the region. Ballet’s CEO, Bobby Lee, voiced potential risks such as increased censorship and scrutiny under the unified regulations. Despite short-term predictions of an upsurge in cryptocurrency engagement in Hong Kong, the long-term regulatory outlook remains uncertain. Nonetheless, Lee remains hopeful yet cautious while closely monitoring the situation.