Hong Kong’s first cryptocurrency-based exchange-traded funds (ETFs) attracted more than $73 million before making their debut on the region’s stock exchange. The launch of the two ETFs tracking US-listed cryptocurrency futures comes despite the industry’s current woes.
Hong Kong debuts Bitcoin and Ether futures ETFs in cryptocurrency winter
Two ETFs tracking cryptocurrency futures raised a combined $73.6 million ahead of their Hong Kong public debut on Friday, with the larger one raising $53.9 million, according to Reuters. The news agency noted that the launch is a challenge to the ongoing turmoil in the industry.
The funds, offered by CSOP Asset Management, invest in bitcoin (BTC) and ether (ETH) futures listed on the American CME exchange, the only crypto assets currently permitted by the Hong Kong Securities and Futures Commission (SFC). Commenting on the development, Yi Wang, head of quantitative investment at the CSOP, said:
Following the recent liquidity issues affecting some of the cryptocurrency platforms, our two cryptocurrency futures ETFs demonstrate that Hong Kong remains open-minded on the development of virtual assets.
This year’s crypto market downturn has led to a significant drop in the prices of major cryptocurrencies with the largest coin by capitalization, BTC, losing more than 70% of its value from its all-time high recorded just over a year ago. year ago.
The decline in rates has been accompanied by a series of bankruptcies in the sector, the latest of which was the collapse of FTX, a major cryptocurrency exchange with a global reach, which filed for bankruptcy in mid-November due to liquidity problems .
Weeks before the crash, the SFC announced in October its intention to start a consultation on whether to allow retail investors to trade cryptocurrencies and ETFs. The watchdog’s initial proposal was to limit participation to professional investors only.
Then in November, Commission Deputy Chief Executive Officer Julia Leung said the SFC is “actively seeking” to establish a regulatory framework that allows trading of cryptocurrency exchange-traded funds.
“Because ETFs do not invest in physical bitcoins and are traded on regulated US and Hong Kong exchanges, there are more regulatory safeguards for investors than tokens traded on unregulated platforms,” Yi Wang explained now.
What do you think of Hong Kong’s debut of cryptocurrency futures ETFs in the current market? Tell us about it in the comments section below.
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