TL;DR
- The approval of new Bitcoin ETFs in Hong Kong could unlock up to $25 billion in investments.
- The Stock Connect program enables mainland Chinese investors to access shares listed on the Hong Kong Stock Exchange, offering a unique opportunity amid the depreciation of the Chinese renminbi.
- Approval is expected by April 15th; subsequently, the Hong Kong Stock Exchange (HKEX) will need approximately two weeks of preparation to list the products.
The potential approval of new Bitcoin ETFs in Hong Kong has sparked interest in the financial community, especially among mainland Chinese investors. According to reports from Matrixport, a Singapore-based crypto services company, these new financial products are expected to unlock up to $25 billion in investment demand through the Stock Connect program.
The Stock Connect program allows mainland Chinese investors to access shares listed on the Hong Kong Stock Exchange. This new Bitcoin investment tool could represent a unique opportunity for Chinese investors. Additionally, it should be considered in the current context, as they are seeking to diversify their portfolios amid the depreciation of the Chinese renminbi against the US dollar.
Approval of the ETFs is expected to be finalized by April 15th. Once approved, the Hong Kong Stock Exchange (HKEX) will need approximately two weeks to prepare for listing the products. As reported, Bitcoin ETFs could be available in Hong Kong approximately three months after their approval in the United States.
Interest in Bitcoin ETFs is not new in Hong Kong. In December, a report from the Hong Kong Stock Exchange indicated that the Stock Connect program had been expanded to include ETFs listed in Hong Kong in July 2022. By September 2023, the program included six ETFs listed in Hong Kong, and their average daily trading volume had grown to HK$2.9 billion.
Bitcoin ETFs Have Already Accumulated Over $12 Billion in Investments
Following their approval, BTC ETFs in the United States have been remarkably successful. In the past four months alone, they have accumulated $12 billion in investments, driving Bitcoin’s price to new highs above $73,000.
As the upcoming halving approaches, scheduled for April 20th, the leading cryptocurrency remains around $70,000. This event, which occurs approximately every four years, has historically been a catalyst for its price.
If the introduction of BTC ETFs in Hong Kong materializes, it could signify a significant step towards the widespread adoption of BTC as a legitimate asset class in the global financial market.
