Hong Kong Ethereum spot ETF will be listed later than Bitcoin! Can domestic investors buy it?

This site (120bTC.coM): Yesterday (15th), the Hong Kong Securities and Futures Commission (SFC) approved the application for Bitcoin and Ethereum spot ETFs, further promoting the mainstream of cryptocurrency use. The first batch of institutions to launch include Hong Kong Harvest International, China Asset Management and Boshi International/HashKey Capital. The market is currently looking forward to when trading will be officially opened.

OSL CEO: Bitcoin ETF will be listed for trading as soon as the end of this month

Hong Kong licensed exchange OSL is also the custodian and infrastructure service provider of Harvest International and China Asset Management, today Its CEO Pan Zhiyong told Foresight News: It is expected that by the end of April, all investors will be able to officially purchase Bitcoin spot ETFs from these three fund companies, just like buying ordinary stocks. Unless something unexpected happens, purchases will be postponed until May.

Relevant persons from HashKey Exchange, another licensed exchange, and VDX, which is applying for a license, also confirmed the news.

However, regarding the launch time of the Ethereum spot ETF, OSL CEO Pan Zhiyong pointed out: It is expected that the Ethereum spot ETF will not be officially traded until the Bitcoin spot ETF has been traded for a period of time.

The specific time interval has not yet been determined. According to the responses of CEOs of many Hong Kong licensed and applying exchanges, the launch interval may be several weeks or even a month later.

How much incremental funds will Hong Kong ETF bring?

Another thing that has attracted much market attention is how much incremental funds will this bring to the encryption market? According to The Block, Katie He, head of product and strategy at China Asset Management, expressed optimism that it is expected that there will be considerable demand for these upcoming virtual asset spot ETFs. She explained that only professional investors in Hong Kong can invest in US-listed spot ETFs, which will make Hong Kong's general investors more interested in local spot products.

However, Bloomberg ETF analyst Eric Balchunas poured cold water on this enthusiasm. He tweeted yesterday (15th) that don’t expect too much capital inflow... I think attracting US$500 million is already pretty good. He gave the following 4 reasons:

• The Hong Kong ETF market is very small, only 5 billion US dollars, and residents of mainland China should not be able to purchase this product, at least the government will not explicitly allow it.

• The three approved issuers (Boshi, Huaxia, Harvest) are also very small, and currently no giants like BlackRock are involved

• The liquidity or efficiency of the underlying ecosystem is very low

• The management costs will be very high, which is relatively weak compared to the management costs in the United States.

Although there is a view that the upcoming Hong Kong spot ETF may attract investors from mainland China through southbound funds, this view is controversial because southbound funds are not currently available. Mainland investors are allowed to invest in Hong Kong’s crypto futures ETFs, not to mention spot crypto products.

Note: To invest in Hong Kong stocks, domestic funds (domestic capital) in China need to enter Hong Kong from the mainland through Shanghai-Hong Kong Stock Connect and Shenzhen-Hong Kong Stock Connect. The total of the two funds is called southbound funds, reflecting the flow of funds from mainland China.

In this regard, Gary Tiu, OSL’s executive director of regulatory affairs, still responded positively: Although crypto ETFs have not yet been included in the list of eligible securities for southbound funds, I think the possibility or at least the potential of including these products is very important to the market. expected.

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