Hong Kong is preparing to launch the first virtual asset spot exchange-traded funds (ETFs) in Asia, poised to beat the United States Securities and Exchange Commission (SEC) to market.
A Wave of Virtual Asset Spot ETF Approvals Coming
Approximately 13 bitcoin spot ETF applications are awaiting approval from the SEC. However, Hong regulators are moving more quickly on the virtual asset ETF front.
According to Livio Weng, COO of HashKey Group, about ten fund companies plan to launch VA Spot ETFs in Hong Kong by the end of 2023. Seven to eight of these funds are in the advanced stages of preparation.
Regulatory Approval Already Given
In December 2023, the Hong Kong Securities and Futures Commission (SFC) and the Hong Kong Monetary Authority (HKMA) issued a circular indicating their readiness to consider VA spot ETF applications.
Shifting Stance Towards Crypto Investing
Since 2018, Hong Kong’s regulatory stance towards crypto has shifted from solely allowing “professional investors” to participation from wider groups of investors. New regulations issued in October will enable retail investors to purchase spot crypto ETFs.
Risk-Balanced Approach to Innovation
Regulators acknowledge the rapid development of the virtual asset landscape and its integration into mainstream finance. The SFC remains open to authorizing various funds with exposure to virtual assets, including VA spot ETFs, while managing associated risks.