Two exchange-traded funds (ETFs) that track US-listed cryptocurrency futures will reportedly debut on the Hong Kong stock exchange this Friday (December 16).
The products will have bitcoin and ether as underlying assets and will become the first futures ETFs listed in Asia.
Crypto ETFs Amid the Recent Turmoil
According to a Reuters coverage, the ETFs will track futures listed on the Chicago Mercantile Exchange in the USA. The products, ticked CSOP Bitcoin Futures ETF and CSOP Ether Futures ETF have raised a combined $73.6 million so far, as the former has accounted for $53.9 million of the amount.
Yi Wang – Head of Quantitative Investment at CSOP Asset Management – thinks the initiative is a clear sign that Hong Kong has not deviated from its crypto path:
“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.”
He further explained that the products do not invest in “physical” bitcoin and ether and allow investors to hop on the bandwagon without buying tokens from “unregulated platforms.”
Speaking on the matter was also Tim McCourt – Global Head of Equity and FX Products, CME Group – who described the launch of the ETFs as an “important milestone for the digital asset ecosystem in Asia.”
Hong Kong’s Securities and Futures Commission allows the issuance of crypto ETFs, but only if they involve bitcoin or ether futures traded on the CME Group.
Aiming to Become a Crypto Hub
Hong Kong’s authorities have previously revealed intentions to legalize cryptocurrency retail trading and impose a friendly regulatory framework on the industry in March 2023.
“Introducing mandatory licensing in Hong Kong is just one of the important things regulators have to do. They can’t forever effectively close the needs of retail investors,” said Gary Tiu – Executive Director at BC Technology Group Ltd.
Completing those steps could form China’s autonomous special administrative region as one of the global crypto hubs.
According to Arthur Hayes (Co-Founder of BitMEX), Hong Kong’s friendly stance on the blockchain sector could change China’s harsh views. Once the most-populated country “loves” crypto back, the market could enter into a bull run, he argued:
“Hong Kong’s friendly reorientation towards crypto portends China reasserting itself in the crypto capital markets. When China loves crypto, the bull market will come back. It will be a slow process, but the red shoots are budding.”