Hong Kong has given its official approval for the first spot-based Bitcoin and Ethereum exchange-traded funds (ETFs), which are set to start trading on April 30, 2024. This move is expected to trigger a “fee war” among ETF providers in the cryptocurrency market, leading to competitive pricing and potential market growth. The approved ETFs are managed by Harvest Global Investments, China Asset Management, Bosera Asset Management, and HashKey Capital, and they are expected to position Hong Kong as a leading hub for digital assets in Asia.
HashKey Exchange, the largest licensed virtual asset exchange in Hong Kong, has reported a trading volume of $4.8 billion, cementing its position among the top 20 exchanges listed on Coingecko. This development was highlighted in a CNF YouTube video that explains the approval and its implications for the cryptocurrency market in Asia.
Following the approval of similar ETFs in the United States, ETF providers in Hong Kong are expected to engage in a “fee war” to secure a competitive edge. Harvest Global Investments has already announced that it will waive management fees for the first six months. Analysts predict that other issuers may follow suit, leading to a potential fee war in Hong Kong.
The cryptocurrency market has responded positively to the approval of these ETFs. HashKey Exchange has completed the first cryptocurrency subscription for the newly approved Bitcoin and Ethereum spot ETFs. These ETFs allow for cryptocurrency redemptions without the immediate sale of the underlying assets, providing cost and liquidity advantages for both issuers and investors.
In the United States, the frenzy for Bitcoin ETFs has led to record-breaking trading turnover, with nine U.S.-listed spot Bitcoin ETFs accounting for approximately $2.4 billion in trading turnover in a single day. Bitcoin has experienced a surge of 5.76% over the past week, with a price of $64,356, according to Today’s Coin Market Cap.
Overall, the approval of spot-based Bitcoin and Ethereum ETFs in Hong Kong is expected to bring significant changes to the cryptocurrency market, with the potential for increased market growth and a competitive pricing environment.