Harvest Global CEO and CIO Tongli Han ‘does not rule out’ applying to offer Bitcoin and Ether exchange-traded funds through the Stock Connect program for mainland Chinese investors within the next two years “if all goes well” He said.
Harvest Global is one of Asia’s first spot Bitcoin and Ether ETF issuers, along with China Asset Management (ChinaAMC) and Bosera/HashKey. Bosera/HashKey listed on the Hong Kong Stock Exchange last month as part of the city’s plans to become a global cryptocurrency. hob.
Han’s remarks were made at the two-day Bitcoin Asia conference, which began in Hong Kong on Thursday, the South China Morning Post reported.
ETF Connect, launched in May 2022, will give mainland Chinese investors access to ETFs listed in Hong Kong. The scheme is an expansion of the Stock Connect scheme, launched in 2014, initially connecting stock exchanges in Hong Kong and Shanghai.
China’s access to cryptocurrency ETFs remains uncertain
Some in the cryptocurrency industry have suggested that a Hong Kong spot cryptocurrency ETF could attract significant investor interest from mainland China through the Stock Connect program, but it does not currently allow mainland investors to invest in Hong Kong’s cryptocurrency futures ETFs, let alone spot. not. Encryption response.
Given the ban on most commercial cryptocurrency activity on the mainland and China’s generally hostile stance toward the cryptocurrency industry, the prospects of such approval, whether applied for or not, remain highly uncertain.
Gary Tiu, managing director and head of regulatory affairs at OSL, which acts as the ETF’s sub-custodian and infrastructure services provider, told The Block ahead of the launch that Hong Kong’s cryptocurrency ETF was not included in the list of eligible securities. The Stock Connect program is not yet available, but “the possibility of such inclusion is something the market certainly likes.”
Hong Kong Cryptocurrency ETF Growth Potential
The Hong Kong spot cryptocurrency ETF was widely considered to have had a disappointing debut, with first-day trading volume of just $11.2 million. This pales in comparison to the first-day trading volume of $4.5 billion for the spot Bitcoin ETF launched in the US. In January.
However, the caveat is that despite the smaller Hong Kong market, issuers have already prepared assets under management before trading begins, whereas in the US they have held off until the ETF debuts.
SCMP said Han expected the product to have a slow start, but said the Hong Kong ETF could grow to twice the size of its U.S. counterpart as its appeal grows across the Asian region. Important step.
But last month, Bloomberg senior ETF analyst Eric Balchunas threw cold water on the potential of Hong Kong ETFs. “Don’t expect much flow. We think they’ll be lucky to get $500 million.” wroteThe Hong Kong ETF market is “small” and “local Chinese cannot buy them, at least not officially,” he added.
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