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Top Chinese asset managers set to launch Bitcoin and Ethereum exchange-traded funds (ETFs) in Hong Kong, possibly as early as Monday, Bloomberg reported Friday, citing anonymous sources familiar with the matter. The timetable, however, remains provisional, sources said.
Harvest Fund Management Co.'s international division and a joint venture between Bosera Asset Management (International) Co. and HashKey Capital are the two potential ETF issuers, Bloomberg's sources said.
As reported, both entities plan to roll out their ETFs by the end of the month, pending approval from the Securities and Futures Commission (SFC) and finalization of listing agreements with Hong Kong Exchanges & Clearing Ltd.
The report follows the announcement earlier this week that prominent Chinese asset managers have applied for spot Bitcoin ETFs through their Hong Kong subsidiaries. According to Bloomberg, on April 9, SFC granted permission to Harvest and China Asset Management to provide fund management services related to virtual assets.
Hong Kong Bitcoin ETFs Poised to Attract $25 Billion
Potential approval of Hong Kong-listed spot Bitcoin ETFs could unlock up to $25 billion in demand from mainland China as qualified Chinese investors could be allowed to access funds through the Southbound Stock Connect program . said Matrixport in a Friday report.
“A likely approval of Hong Kong-listed Bitcoin Spot ETFs could attract several billion dollars of capital as mainland investors take advantage of the Southbound Stock Connect program, which facilitates up to RMB 500 billion (HK$540 billion). and $70 billion) per year in transactions,” Matrixport said. “Based on the (potential) capacity available, this could result in up to HK$200 billion of available capacity for these Bitcoin ETFs. Hong Kong, or 25 billion US dollars.”
The Southbound Stock Connect program sets an annual limit of HK$540 billion for Chinese investments in Hong Kong-listed stocks. However, data from 360MarketIQ shows that the quota has not been fully used over the past three years, leaving around HK$100 billion to HK$200 billion of unused capacity per year.
Matrixport suggested that this unused quota could be directed to the Bitcoin ETF if approved.
After the launch of spot Bitcoin ETFs in the United States, global investors have considered Hong Kong as the next crypto ETF hub due to the country's regulatory environment.
At the end of December last year, the SFC and the Hong Kong Monetary Authority (HKMA) issued new rules regarding whether investment funds, brokerages and asset managers can offer ETFs cryptographic. The move was seen as preparation for upcoming crypto ETF products.
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