- Gary Tiu stated that the special administrative region could potentially host the first spot cryptocurrency exchange-traded funds (ETFs) by mid-year.
- Tiu mentioned that about five of these companies have made significant progress, and by mid-2024, they could launch Hong Kong’s first spot crypto ETFs.
- Livio Weng, Chief Operating Officer of HashKey, had previously announced that approximately ten fund companies had initiated exploratory discussions to introduce such ETFs in Hong Kong.
OSL, a licensed cryptocurrency exchange in Hong Kong, has announced that spot crypto ETFs could be launched in Hong Kong this year.
OSL Reveals Expectations for Crypto ETFs
Gary Tiu, Executive Director and Head of Regulatory Affairs at OSL, a licensed cryptocurrency exchange in Hong Kong, announced that the special administrative region could potentially host the first spot cryptocurrency exchange-traded funds (ETFs) by mid-year. This development comes in an environment where Hong Kong continues to explore opportunities in the rapidly changing cryptocurrency market.
In a recent interview with local media, Gary Tiu stated that OSL is actively in talks with several fund companies and is currently exploring the possibility of launching spot crypto ETFs with about five to ten companies. Tiu mentioned that about five of these companies have made significant progress, and by mid-2024, they could launch Hong Kong’s first spot crypto ETFs.
The effort to bring these spot crypto ETFs to Hong Kong is not without challenges. Tiu acknowledged the necessity of keeping the fees for these products reasonably low, especially considering that the city has only two licensed cryptocurrency exchanges.
Gary Tiu emphasized the importance of introducing spot crypto ETFs to the city’s financial landscape, noting that they offer several key advantages, such as promoting regular markets for fundamental digital assets, creating a strong model for local investor protection, and expediting integration with regulated digital asset platforms and traditional financial institutions.
Tiu’s statements followed the remarks of HashKey, a Hong Kong-licensed cryptocurrency exchange that had discussions with asset managers earlier this month about the potential launch of spot crypto ETFs. Livio Weng, Chief Operating Officer of HashKey, had previously announced that approximately ten fund companies had initiated exploratory discussions to introduce such ETFs in Hong Kong.
Ambitious Plans of Venture Smart Financial Holdings Ltd
Venture Smart Financial Holdings Ltd, a Hong Kong-based financial services firm, announced plans to potentially launch a spot Bitcoin ETF in the first quarter of this year. According to Bloomberg, the company aims to grow the ETF to $500 million in assets under management by the end of 2024, highlighting the increasing interest in crypto ETFs in the region.
This move towards spot crypto ETFs in Hong Kong has been met with regulatory preparations by the authorities. In December of last year, the Securities and Futures Commission (SFC) and the Hong Kong Monetary Authority (HKMA), the city’s de facto central bank, jointly announced that they were reviewing their existing policies to facilitate the introduction of spot crypto ETFs. Regulators issued two circulars focusing on the requirements for spot crypto ETF transactions.
The SFC emphasized that transactions involving spot crypto ETFs must be conducted through SFC-licensed crypto platforms or authorized financial institutions. This is a step aimed at ensuring regulatory oversight and investor protection.
Current Crypto ETF Offerings in Hong Kong
Hong Kong has listed a range of futures-based crypto ETFs, including Samsung Bitcoin Futures Active ETF, CSOP Bitcoin Futures ETF, and CSOP Ether Futures ETF. These offerings exposed investors to cryptocurrency markets through futures contracts. However, the introduction of spot crypto ETFs will provide a different investment vehicle focused on direct ownership of digital assets.
The cryptocurrency market in Hong Kong and globally is rapidly evolving with increasing interest from institutional and retail investors. The introduction of spot crypto ETFs in Hong Kong will be a significant milestone in providing investors with more diverse and regulated options in this dynamic market.
As discussions and preparations for spot crypto ETFs progress, the financial industry in Hong Kong may face a potential transformation in the coming months, closely monitoring the launch of these innovative investment products.
