The debut of the Hong Kong Bitcoin ETF has sparked mixed reactions, with some experts expressing disappointment in its performance. However, Harvest Global Investments CEO Han Tongli believes that these criticisms are politically motivated and asserts that the potential of Hong Kong ETFs is far greater than that of the US.
The highly anticipated Hong Kong Bitcoin ETFs had a lackluster debut on April 30, and on May 9, they experienced a second consecutive day of net outflows since inception. China Asset Management’s ETF saw 80.16 BTC ($5 million) leaving the product on May 9, while Bosera HashKey Bitcoin ETF recorded an outflow of 10 BTC ($629k).
On the same day, the three ETFs had a total trading volume of $2.06 million, a decrease from the $2.67 million seen on May 8 and the $9.74 million recorded on April 30. On May 8, the three Bitcoin ETFs also saw net inflows of 101.6 BTC ($6 million) and 99.99 BTC ($6.2 million) on May 7.
Considering these figures, some market analysts deemed the outcome disappointing and criticized the debut and subsequent performance. However, Han Tongli, the CEO of Harvest Global Investments, disagrees with these comments and argues that the potential of Hong Kong ETFs is more than double that of the US. Interestingly, crypto commentators scrutinized this claim and found a significant imbalance. Data shows that the six Hong Kong ETFs only attracted around $13 million on their debut, which is just 0.3% of the funds attracted by US ETFs.
Despite the skepticism, Han Tongli stands by his statement and maintains that, unlike US ETFs, Hong Kong ETFs allow in-kind transactions, enabling investors to trade directly using cryptocurrencies.
Tongli suggests that in order to witness a significant transformation within the ETF ecosystem, Hong Kong ETFs should appeal to international investors who have chosen not to invest in the US for various reasons. He believes that the ongoing regulatory crackdown and uncertainties surrounding the crypto ecosystem in the US have made many non-western investors hesitant to get involved. Tongli suspects that the criticisms of the Hong Kong ETFs are unfounded and politically motivated due to Hong Kong’s status as a special administrative region of China.
Interestingly, this aligns with the views of Gabor Gurbacs, the founder of Pointsville, who claims that geopolitical ETF competition is intensifying.
In comparison, US Spot Bitcoin ETFs have accumulated nearly $53 billion in assets since their launch, while Hong Kong’s ETF has only achieved a fraction of this amount.
Bloomberg Intelligence ETF analysts James Seyffart and Eric Balchunas advise investors not to expect significant numbers in terms of performance. They argue that the volume should be understood within the context of Hong Kong’s market size. Yimei Li, the CEO of China Asset Management, also explains that the ETFs could be accessible to the Chinese market, where crypto trading is currently banned, as suggested by Crypto News Flash.
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