Hong Kong Has Approved Its First Exchange-Traded Funds (Etfs) Based On Bitcoin And Ethereum.

Hong Kong's securities regulator has approved physically-backed ETF models for Bitcoin and Ether, in contrast to the cash-backed models commonly used in the United States.

Hong Kong has become the latest country to allow the implementation of spot exchange-traded funds (ETFs) for Bitcoin and Ether. According to an announcement by the Securities and Futures Commission (SFC) of Hong Kong on April 15th, the first spot BTC and ETH ETFs have been conditionally approved.

With this approval, offshore Chinese asset managers such as Harvest Fund Management, Bosera Asset Management, and China Asset Management's (ChinaAMC) Hong Kong units have announced their plans to soon launch spot Bitcoin and Ether ETFs. OSL Digital Securities, which will serve as the custodian for ChinaAMC, is also involved in this development.

In addition to Harvest and Bosera, which were conditionally approved by the SFC, ChinaAMC has also stated that it continues to work on ETFs after obtaining regulatory approval to provide virtual asset management services.

These ETFs will be based on a creation model that allows new shares to be issued directly using Bitcoin and Ether, without the need for cash. This model operates contrary to the existing cash creation model in the United States.

These new developments not only strengthen Hong Kong's position as an international financial center but also establish it as a significant hub in the virtual asset market. It is expected that Bosera and ChinaAMC will start trading on the Hong Kong Stock Exchange (HKEX) approximately two weeks after the completion of the approval process.

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