Hong Kong Embraces Crypto Growth with Surging Bitcoin ETF

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Hong Kong’s premier bitcoin futures ETF has witnessed a remarkable five-fold increase in assets since last October, topping the $100 million mark. This surge aligns with a growing appetite among local investors, who are riding the wave of the cryptocurrency’s global ascendancy.

Despite its later entry into the cryptocurrency market, Hong Kong made significant strides by sanctioning its initial trio of cryptocurrency futures ETFs in the closing months of 2022. The CSOP Bitcoin Futures ETF, managed by CSOP Asset Management, has particularly seen a spike in demand this February.

The advent of spot bitcoin ETFs in the United States earlier this year has ignited investor interest, with many betting on the digital currency’s scarcity to buoy its value. Alessandro Zhu of CSOP Asset Management highlights the robust performance of bitcoin, which has not only outshone Hong Kong stocks but also piqued interest from offshore Chinese financial entities.

Currently, bitcoin’s value has soared by 45% this month, flirting with its historic peak prices from November 2021. Meanwhile, the CSOP Ether Futures ETF has also reaped benefits, with its assets doubling in 2023.

Transaction volumes are on the rise, with the daily average turnover for the CSOP Bitcoin Futures ETF this year hitting $2.8 million, matching the turnover rates of some leading Hong Kong real estate firms.

With Hong Kong poised to potentially greenlight its first spot bitcoin ETF, the city is cementing its status as a burgeoning nexus for virtual assets. Kennix Chan of Victory Securities acknowledges the surge of spot bitcoin ETF applications, signaling a bright future for Hong Kong’s ETF landscape.

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