Tech
Ether ETFs Jump in Hong Kong Awaiting US Approval for Similar Crypto Products
The spot ether Exchange Traded Fund (ETF) launched by Chinese manager ChinaAMC recorded more than HK$5 million (US$640,780) in net inflows as of midday on Wednesday, after reaching $3.77 million in Hong Kong on Tuesday, the biggest since launch, as investors anticipate US approval of similar products.
The ETF saw more than 1.28 million shares traded Tuesday. According to Hong Kong stock exchange data, on most days since its launch on April 30, around 500,000 shares have been traded. On Tuesday, net inflows were HK$3.77 million.
Hong Kong’s other two ether spot ETFs, issued by investment firms Harvest Global, Bosera and HashKey Capital, also saw higher-than-usual volumes this week. Prices of all three ETFs rose more than 18% on Tuesday.
Turnover in Hong Kong’s cryptocurrency spot ETFs, despite being hailed as an important step in the city’s bid to become a virtual asset hub, has remained poor on most days since their launch. Trading volume is minimal compared to spot bitcoin ETFs in the United States, which approved products in January.
While ETFs are seen as an important way for volatile virtual assets to attract mainstream investors, possibly helping to boost prices, the initial impact of the Hong Kong launches on the broader global cryptocurrency market seemed to be “deactivated”.
Analysts pointed out that Hong Kong’s ETF market is significantly smaller than that of the United States and argued that the city’s spot crypto ETFs, the first of their kind in Asia, are important for adoption and acceptance global virtual asset market.
The surge in cryptocurrency ETF trading volume in Hong Kong this week came as cryptocurrency prices surged following news that the U.S. Securities and Exchange Commission (SEC) is more likely to approve spot ether ETFs.
Bloomberg Intelligence ETF analysts Eric Balchunas and James Seyffart raised their estimated probability of approval from 25% to 75% on Tuesday, suggesting a possible change in the SEC’s stance on these products.
The price of Ether has increased by more than 20% this week, exceeding $3,700. Bitcoin also rose about 4% to above $71,000.
The SEC is expected to make a decision on at least one of the ether ETF applications by May 23.