Hong Kong SFC receives first spot Bitcoin ETF application

The Hong Kong Securities and Futures Commission (SFC) is reportedly processing its first application for a spot Bitcoin exchange-traded fund (ETF), following the recent approval of a similar ETF by the U.S. Securities and Exchange Commission. This development signifies a major step in the integration of cryptocurrencies into mainstream financial products in Asia.

Harvest Hong Kong, a prominent fund manager in China, submitted the application for a spot Bitcoin ETF to the SFC on January 26. The regulatory body is said to be expediting the approval process, aiming to launch Hong Kong’s first spot Bitcoin ETF shortly after the Chinese New Year on February 10.

Potential for Multiple Spot ETF Approvals

Mirroring the approach of the U.S. SEC, the Hong Kong SFC may approve multiple spot ETFs to ensure fair competition. Harvest Fund’s application might be the first, but other financial institutions in the region have also shown interest in launching their own spot BTC ETFs in 2024.

At least 10 financial entities in Hong Kong are reportedly working towards launching spot BTC ETFs, with Venture Smart Financial Holdings targeting the first quarter of 2024 for their launch.

Several firms that previously launched futures-based crypto ETFs in Hong Kong, such as Samsung Asset Management, are considering the possibility of introducing spot Bitcoin ETFs.

Hong Kong’s Pro-Crypto Regulatory Stance

In 2023, the Hong Kong SFC established crypto-focused regulations, enabling both institutional and retail investors to engage in cryptocurrency activities. This proactive regulatory environment has positioned Hong Kong as a leading crypto hub in Asia.

Readiness for Crypto ETFs

Even before the U.S. SEC’s approval of the first spot BTC ETF, the Hong Kong SFC had opened the door for crypto-based ETFs. The commission expressed its readiness to authorize various funds, including digital asset spot ETFs and existing crypto futures ETFs.

Hong Kong’s swift movement towards integrating spot Bitcoin ETFs, coupled with its welcoming regulatory framework, underscores the region’s commitment to embracing digital assets. This trend not only reflects the growing global interest in cryptocurrencies but also positions Hong Kong as a key player in the evolving landscape of crypto finance.