Hong Kong’s top finance official touts flexible crypto ETF features amid web3 push

The Block2024/06/12 08:10

By:Timmy Shen

Christopher Hui, Secretary for Financial Services and the Treasury, said that the in-kind subscription and redemption feature of the city’s six spot crypto exchange-traded funds gives investors more flexibility.The three Hong Kong spot bitcoin ETFs recorded $6.67 million in total daily trading volumes on Tuesday, compared to $2.35 million on Friday.

Hong Kong’s finance secretary stated that the in-kind subscription and redemption feature of the city’s six spot crypto exchange-traded funds offers investors more flexibility, as Hong Kong continues its drive to become a regional cryptocurrency hub.

Christopher Hui, Secretary for Financial Services and the Treasury, wrote in a blog post released Tuesday that he promoted Hong Kong’s web3 policies during his visits to a few European forums last week, adding that the government has implemented a series of regulations for crypto and tokenization.

“In terms of product innovation, the first batch of six virtual asset spot ETFs in Asia were listed in Hong Kong in April. Notably, Hong Kong pioneered an in-kind redemption mechanism that offers investors greater flexibility when subscribing to and redeeming units of virtual asset ETFs,” Hui said.

However, the performance of the spot crypto ETFs in Hong Kong seems to pale in comparison to that of their U.S. counterparts.

The three Hong Kong spot bitcoin ETFs recorded a total daily trading volume of $6.67 million on Tuesday, after logging $2.35 million on Friday and $6.08 million on Thursday, according to The Block’s data dashboard . Monday was a public holiday in Hong Kong. By comparison, the 11 spot bitcoin ETFs in the U.S. saw $1.1 billion in total trading volume on Monday, following Friday’s $2.51 billion.

Hong Kong regulators and industry players are now discussing the possibility of including staking within the spot ether ETFs, which could serve as a “competitive edge,” Animoca Brands Chairman Yat Siu told The Block last week. “In terms of how quickly, there’s an optimistic side of me that wants it to happen within the year,” Siu added.

Hui, the Treasury chief, also said in the post that the government issued the second batch of multi-currency tokenized bonds earlier this year with a total amount of $770 million, “representing the world's first digitally native multi-currency government green bonds.”

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