In a groundbreaking growth for the crypto sector in Hong Kong, Harvest Fund Hong Kong, a outstanding participant amongst China’s fund firms, has taken an enormous step by submitting an utility for a Bitcoin spot Alternate Traded Fund (ETF) to the Hong Kong Securities and Futures Fee (SFC). This transfer, solely reported by Chinese language media Tencent Information, represents the primary of its sort in Hong Kong, signaling a major shift within the area’s strategy to digital asset buying and selling and funding.

Chinese language Spot Bitcoin ETF By February 10?

The appliance by Harvest Fund marks a pivotal second in Hong Kong’s monetary panorama, following carefully on the heels of the US Securities and Alternate Fee’s (SEC) landmark approval of the primary batch of US Bitcoin spot ETFs on January 11, 2024. This US determination included the conversion of the Grayscale Bitcoin Belief’s GBTC from a closed-end fund to a Bitcoin spot ETF, in addition to the approval of purposes from Western monetary behemoths comparable to BlackRock and Constancy.

Within the wake of those developments, the Hong Kong SFC is reportedly contemplating expediting the approval course of for the primary Bitcoin spot ETF within the area, with plans to record it on the Hong Kong Inventory Alternate shortly after the Chinese language New Yr, as early as February 10. The Tencent Information report means that the SFC could undertake an analogous technique to the US SEC by approving a number of spot ETF purposes concurrently, though, as of now, Harvest Fund stays the only applicant.

Business insiders speculate that even with the approval of a number of spot ETFs, the dominance of huge establishments within the US market, comparable to BlackRock and Constancy Funds, could also be mirrored in Hong Kong. This expectation stems from the numerous investor bases and intensive buyer acquisition networks these establishments possess. As an example, BlackRock’s IBIT presently ranks third in dimension amongst over 600 ETFs issued within the US up to now 12 months, highlighting the rising investor curiosity in spot ETFs over different ETF sorts.

There are additionally rumors of a attainable operational divergence between the spot ETFs within the US and Hong Kong. In response to Tencent Information sources, along with money creation, Hong Kong spot ETFs might additionally supply the potential for Bitcoin redemptions “in kind“, a characteristic not presently obtainable on US spot ETFs. Nonetheless, the SFC has not formally commented on this side.

Additional Fund Firms Prepared To Launch?

As reported earlier by Bitcoinist, roughly ten Chinese language asset administration firms are gearing as much as launch spot Bitcoin and crypto ETFs in Hong Kong, a transfer indicative of the area’s rising acceptance and integration of digital property into its monetary ecosystem. Livio Weng, COO of HashKey Group, revealed that seven to eight of those firms are “in advanced stages” of launching these merchandise.

This initiative aligns with the evolving regulatory stance of the SFC and the Hong Kong Financial Authority (HKMA). In December 2023, they issued a round expressing their openness to purposes for digital asset spot ETFs, marking a departure from their earlier “professional-investors only” coverage established in 2018. This shift displays a broader pattern in direction of embracing and regulating digital property, positioning Hong Kong as a possible hub for Bitcoin and crypto funding and innovation.

At press time, BTC traded at $42,267.