HK Asset Managers Eye Bitcoin Spot ETFs With Regulatory Relaxations

Hong Kong subsidiaries of Chinese asset managers, including Harvest Fund and Southern Fund, are pursuing Bitcoin spot exchange-traded funds (ETFs) in the region. Driven by the Securities and Futures Commission's acceptance of ETF applications, these companies seek to capitalize on investor demand for direct Bitcoin exposure. Amid regulatory restrictions on crypto activities in mainland China, Hong Kong provides a viable platform for such ETF offerings.

Hong Kong Asset Managers Seek to Offer Bitcoin Spot Exchange-Traded Funds

Multiple subsidiaries of Chinese asset management companies based in Hong Kong have expressed interest in offering Bitcoin spot exchange-traded funds (ETFs) within the administrative region.

According to reports published on Monday by Chinese state newspaper Securities Times, Harvest Fund and Southern Fund, each managing assets surpassing $200 billion, have indicated their desire to launch such ETFs. The move is a response to the Hong Kong Monetary Authority's (HKMA) and the Securities and Futures Commission's (SFC) decision to accept applications for crypto-based ETFs.

Due to stringent regulations prohibiting cryptocurrency trading and mining in mainland China, asset managers there are unable to offer such ETFs. However, Hong Kong's more relaxed regulatory environment provides an opportunity for these companies to capitalize on the growing demand for Bitcoin spot ETFs.

It is understood that Harvest Fund's Hong Kong subsidiary has already submitted an application for a Bitcoin spot ETF in January. Southern Fund, which currently offers Bitcoin futures ETFs and Ether futures ETFs in Hong Kong, is also reportedly exploring the possibility of launching a spot Bitcoin ETF.

The introduction of spot Bitcoin ETFs in Hong Kong is highly anticipated by crypto investors, who have been eagerly awaiting the availability of such products for months. If approved, these ETFs would provide investors with a convenient and regulated way to gain exposure to Bitcoin, the world's leading cryptocurrency by market capitalization.

In 2022, Harvest Fund Management's Hong Kong-based trading arm launched a crypto futures ETF, demonstrating its commitment to expanding its offerings in the digital asset space.

The news of asset managers seeking to launch Bitcoin spot ETFs in Hong Kong highlights the growing demand for cryptocurrency in the region and the potential for Hong Kong to become a major hub for the cryptocurrency industry. The HKMA and the SFC's open stance towards crypto-based ETFs is seen as a significant step towards providing investors with a safe and reliable way to access this emerging asset class.