Bitcoin and Ethereum ETFs filed by Hong Kong’s three AUM

Hong Kong will soon have its first Bitcoin and Ethereum exchange-traded funds as three asset management firms have submitted their ETF applications to the Securities and Futures Commission [SFC]reported local media Nikkei Asia.

The three AUMs in the race are CSOP Asset Management, Samsung Asset Management and Mirae Asset Global Investments.

Once approved, bitcoin and ether futures will go live on the Chicago Mercantile Exchange, according to people familiar with the plans.

The move comes amid Hong Kong’s big ambition to position itself as the global crypto hub.

Despite the FTX contagion sending a chill across the industry, institutional and retail clients in Hong Kong, mainland China and Taiwan have shown more interest in investing in cryptocurrency ETFs.

This was stated by Chris Pigott, head of Asia ETF services for Brown Brothers Harriman, citing an annual survey by the company. However, the recent issues with FTX and volatility in the cryptocurrency market could affect investors’ views, he said.

Pigott expects the first product to be released before the end of 2022 or early next year, depending on issuer readiness.

The Hong Kong SFC stated that the city’s cryptocurrency industry had made “significant progress” over the past four years, providing the framework for retail investors, unlike mainland China, which has explicitly banned cryptocurrencies.

But on the regulatory front, officials remain cautious. Last month, the Hong Kong Monetary Authority told the city’s Legislative Council that proper regulation was needed to become a hub for digital assets.

The city is amending its anti-money laundering law, strengthening investor protections and requiring all virtual asset exchanges to be licensed. The bill is expected to be adopted at the end of the year.

Bitcoin ETFs are recovering after BTC hit a 2-week high

That said, approval of the ETF applications can take up to three months, but will be prioritized early if it is in the government’s interest. All sources declined to be named, citing the need to protect their identities.

On November 30, Bitcoin strategy-focused exchange-traded funds trailed higher as the underlying digital currency hit a two-week high.

Funds like the ProShares Bitcoin Strategy ETF [NYSEARCA: BITO]Valkyrie Bitcoin Strategy ETF [NASDAQ: BTF]and the VanEck Bitcoin Strategy ETF [BATS: XBTF] everything was trading in the green early as Bitcoin surged over 2%.

Currently, Bitcoin is hovering just above $17k after a massive decline in early November.