Approval of Bitcoin and Ethereum ETFs in Hong Kong: Fee War Expected to Begin
The Hong Kong Securities and Futures Commission (SFC) has given the green light to three spot Bitcoin and Ethereum exchange-traded funds (ETFs) that are set to begin trading on April 30. This move marks a significant development in the cryptocurrency investment space in Hong Kong.
The approved ETFs, offered by China Asset Management Co. (China AMC), Harvest Global Investments, and Bosera International and HashKey Capital, will all have Bank of China International-Prudential Trustee Limited (BOCI-Prudential) as their custodian. These ETFs aim to closely track the performance of Bitcoin and Ethereum, as measured by the CME CF Bitcoin Reference Rate and the CME CF Ether-Dollar Reference Rate, respectively.
One of the key highlights of this approval is the potential fee war that could ensue among the issuers. Bloomberg Intelligence ETF analyst James Seyffart revealed that the issuers have disclosed their fees, with Harvest Global offering a six-month fee waiver and the lowest fee of 0.3% thereafter. This competitive fee structure could attract investors looking to capitalize on the growing popularity of cryptocurrencies.
China AMC, in particular, sees this approval as an opportunity to offer innovative investment choices to both retail and institutional investors in the Asian market. The company’s Head of Digital Assets and Head of Family Office Business, Thomas Zhu, highlighted the safety, efficiency, and convenience that these ETFs bring to the table for investors looking to venture into virtual assets within a regulated framework.
With the launch of these Bitcoin and Ethereum ETFs, Hong Kong is taking a significant step towards fostering a vibrant web3 ecosystem and providing investors with regulated avenues to participate in the cryptocurrency market. The competition among the issuers and the strategic differentiations they offer could pave the way for a new era of cryptocurrency investment in the region. Stay tuned for the trading debut of these ETFs on April 30.
