The citizens of Mainland China will not be able to purchase or seek exposure in Bitcoin ETFs approved by Hong Kong. Bitcoin and Ethereum ETFs that Hong Kong regulators recently approved are not going to be accessible for investors based out of Mainland China.
The reason for the barring of investors from China is the law preventing the locals from making crypto transactions, which was established a few years ago.
The approved Bitcoin and Ethereum ETFs have not opened the market for investors in Mainland China as per Bloomberg data analyst Jack Wang. The approval of spot Bitcoin and Ethereum ETFs are to be issued by Chinese asset management firms namely Harvest Global Investments, Bosera, and China Asset Management. These spot crypto ETFs issued as Hong Kong-based subsidiaries on 30th April, 2024.
However, the ETFs are closely connected with Mainland China but they will not offer services to the investors based out of their local jurisdiction. The citizens of the firm are not allowed to partake in Bitcoin or Ethereum spot ETF Wang noticed in a 24 April Bloomberg webinar.
He also quoted the statement issued by the Chinese State Council in September 2021 indicating that financial institutions may not create accounts, send funds, or offer private clearing services with cryptocurrencies.
Chinese Investors to Refrain from Investing in Spot Crypto ETFs
Wang noticed that he attempted to make a trade and broker rejected the trade directly. He noticed that futures-based crypto ETFs are listed in Hong Kong and informed that investors hailing from China will not get in touch with the product at all in the the short-term.
He further noticed that the launch of spot crypto ETFs in Hong Kong is not going to have any impact on the regulatory framework for cryptocurrencies within Chinese territories.
He further noticed that investors based out of China will not set up any type of market prospects for crypto investors hailing from China. He stated that there is a 100% certainty against any changes regarding Chinese authorities as the exodus on cryptocurrencies is going to transpire.
Meanwhile, Thomas Zhu, the head of digital assets at China Asset Management, told the media that the eligibility criterion is dependent on regulatory modifications.
Speaking about the products, he noticed that since 2014 the investors hailing out of Mainland and Hong Kong have consolidated their efforts to establish a Mainland-Hong Kong Stock network. These links will allow investors hailing from the mainland to directly access stocks and ETFs that are listed on Hong Kong.
The rise in optimism regarding the launch of spot Bitcoin and Ethereum ETFs in Hong Kong Bloomberg analyst James Seyffart noticed that Bitcoin ETFs in the USA have more assets in comparison to all ETFs in Hong Kong.
US ETF Market Will Become a $8 Trillion Sector
Seyffart noticed that the US ETF market is about to become a bigger than $8 trillion sector. The whole of the Hong Kong ETF market is set around $50 billion. Mainland China ETFs are set around $325 billion and there are literal orders of magnitude differences in size and impact of these funds in a 21st April post on X.
Another Cointelegraph report indicated that Bitcoin and Ethereum spot ETF have amassed around $200 million in AUM as of 30th April 2024. As per Arkham Intelligence, the Bosera Hashkey spot Bitcoin and Ethereum ETFs have acquired around 963 Bitcoin units and 4290 ETH tokens.
The total AUM of the firm is now estimated to be around $71.96 million. Bloomberg analyst Eric Balchunas noticed that Bitcoin and Ethereum spot ETFs issued by ChinaAMC are now valued at $123.61 million.
At the same time, the value of Harvest Global has now reached as high as $23 million for two digital asset ETFs. On the other hand, the overall value of spot Bitcoin ETFs issued in the United States reached a wholesome trading volume of $4.5 billion as quickly as 12th January 2024.
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