Hong Kong seeks to allow crypto futures ETFs

An official at Hong Kong’s financial sector regulator, the Securities and Futures Commission, said on Monday the institution is actively seeking to build a regime to allow digital asset-based exchange-traded funds (ETFs) to be publicly listed and traded in the city.

See related article: Can ETFs in Australia do for Bitcoin what they did for gold trading?

Fast facts

  • A circular will be issued later on Monday to reveal more details about the plan, said the SFC’s deputy chief executive officer, Julia Leung.

  • ETFs are a form of pooled securities that track specific assets, which can be a basket of stocks or bonds covering an industrial sector, a single commodity or other investments.

  • At the initial stage, the underlying assets of the ETFs will be confined to Bitcoin futures and Ether futures traded on the Chicago Mercantile Exchange.

  • “The SFC has been actively looking to set up a regime to authorize ETFs which provide exposure to mainstream virtual assets with appropriate investor guardrails,” Leung said.

  • Monday marks the first day of Hong Kong’s flagship crypto event Fintech Week 2022. The event is seen as a turning point for Hong Kong to declare its return as a crypto hub.

  • In addition to crypto futures-based ETFs, Leung also discussed the SFC’s regulatory considerations over tokenized securities and whether to allow retail investors to enter the investment market.

See related article: Bitcoin ETFs beckon as SEC spurns sweet spot