According to its CEO, Harvest, the issuer of a spot Bitcoin exchange-traded fund (ETF) in Hong Kong, is seeking options to grant mainland Chinese investors access to its Bitcoin ETF.
Han Tongli, CEO and CIO of Harvest is contemplating alternatives that would enable investors from mainland China to acquire the company’s Bitcoin and Ether exchange-traded funds.
According to a May 9 report by The South China Morning Post, it would be feasible if the company offered its products via Hong Kong’s ETF Connect framework.
The China Securities Regulatory Commission and the Securities and Futures Commission approved the ETF Connect before its 2022 launch. The instrument aims to facilitate interaction and integration between Hong Kong and mainland China, provide various asset allocation options, and increase liquidity.
As long as “everything goes smoothly and well” over the next two years, Harvest remains open to applying to have its ETFs included in the ETF Connect, according to CEO Tongli.
Given the sizeable investor base in China, the prospective inclusion of Bitcoin and Ether ETFs in the ETF Connect program could be an enormous bullish catalyst for cryptocurrency markets.
However, the extent to which the Chinese government would facilitate this opportunity for its citizens remains to be determined, given that local authorities have long adhered to a stringent stance regarding cryptocurrencies such as Bitcoin.
SCMP reports that Stock Connect does not consider the 2022-launched Bitcoin and Ether futures-based ETFs from Hong Kong.
The capacity of Hong Kong to offer Bitcoin ETFs to investors in mainland China was contentious before the April 30, 2024, launch of Bitcoin and Ether ETFs in Hong Kong.
Because the Hong Kong ETF market is considerably smaller than those in the United States and mainland China, many industry analysts anticipated little market activity in response to the launch.
According to Bloomberg data, some Hong Kong-based subsidiaries of mainland Chinese companies have 1,400% more assets than in the local market. According to some sources, all Hong Kong ETFs should represent 0.6% of the U.S. ETF market.
