The arrival of Bitcoin and Ether exchange-traded funds (ETFs) in Hong Kong is a significant event, but it does not bring new investment opportunities for mainland China residents, according to Bloomberg data analyst Jack Wang.
After Hong Kong approved BTC and ETH ETFs, major Chinese asset management firms, including China Asset Management, Harvest Global Investments, and Bosera, have been preparing to launch their own crypto ETFs by the end of April through their subsidiaries in the region.
However, despite the close connections these issuers have with mainland China, Wang clarified that Chinese citizens will not be able to participate in these offerings. This restriction is a result of a directive from the Chinese State Council, which was implemented in September 2021 and prohibits financial institutions from engaging in cryptocurrency-related transactions.
Even attempts to trade futures-based crypto ETFs listed in Hong Kong have faced obstacles. “I actually tried to establish a trade for the futures-based crypto ETF listed in Hong Kong, but the brokers simply rejected the trade,” Wang commented, highlighting the direct exclusion of Chinese investors from this market.
Wang emphasized that the introduction of Bitcoin and Ether ETFs in Hong Kong will not lead to changes in mainland China’s regulations or open up the cryptocurrency market to Chinese investors. “I can say with 100% certainty that it won’t happen,” Wang said. However, Thomas Zhu, head of digital assets at China Asset Management, mentioned the possibility, albeit conditional, that mainland China investors could eventually acquire these ETFs depending on future regulatory adjustments.
Disclaimer: The opinions expressed in this article are for informational purposes only and do not constitute financial, investment, or other advice. Investing or trading cryptocurrencies carries a risk of financial loss.
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