Bitcoin spot ETFs poised to make their debut in Hong Kong, but with tempered expectations
Expectations for investments may not reach previous estimates in the near and medium term.
Regulatory approval may pave the way for the introduction of spot Bitcoin and Ethereum exchange-traded funds (ETFs) in Hong Kong as early as next week. However, analysts are warning that the immediate impact of these ETFs might be limited due to factors such as market size, investor restrictions, and less competitive structures compared to the US market.
According to Eric Balchunas, an ETF analyst at Bloomberg, while the approval is a positive development for cryptocurrency adoption, the launch of these ETFs in Hong Kong is unlikely to have the same magnitude of impact as in the US market.
Previously, Matrixport suggested that the potential approval of Hong Kong-listed spot Bitcoin ETFs could generate up to $25 billion in demand from mainland China. This projection was based on the possibility of Chinese investors gaining access through the Southbound Stock Connect program.
However, analysts believe this estimate to be overly optimistic considering the relatively young state of Hong Kong’s ETF market, which currently holds only $50 billion in assets.
Just to be clear, all this is clearly positive for bitcoin as it opens up more avenues to invest, I’m just saying it’s child’s play vs US. Also long-term some of this could go away: more liquidity, tighter spreads, lower fees, and bigger issuers involved. But short/medium term we have…andcircuit;….