For Hong Kong to effectively compete globally, it must attract larger inflows and increase engagement from retail and institutional investors.
Hong Kong’s growing cryptocurrency investment scene has hit a notable milestone, with the total asset management scale of the city’s Bitcoin exchange-traded funds (ETFs) now exceeding HK$2 billion ($256 million).
This milestone highlights the increasing interest and trust in digital assets within Hong Kong, despite a slower start compared to the United States.
Data from SoSo Value shows that the three spot Bitcoin ETFs in Hong Kong saw a net inflow of around 247 BTC this week, bringing their total holdings to about 4,450 BTC. This represents a weekly increase of 5.9%.
These ETFs’ total asset management scale is now approximately HK$2.113 billion.
Looking closer at the distribution of these assets, it becomes clear that two of the Bitcoin ETFs, managed by China Asset Management and Harvest Asset Management, are the leading entities in the market.
These ETFs, which are operated in collaboration with the digital asset trading platform OSL, control an impressive HK$1.337 billion in assets, making up over 63% of Hong Kong’s total Bitcoin ETF market.
The third spot Bitcoin ETF, which is not associated with OSL, manages HK$776 million in assets, accounting for about 42% of the market.
OSL’s strong market position highlights investor confidence in its management and operations, but it also points to the limited choices available to investors in Hong Kong’s Bitcoin ETF market.
A Slow Start Compared to the US
Despite recent improvements, Hong Kong’s Bitcoin ETFs have not performed as well as those in the US.
When these ETFs were launched on April 30, they attracted a total of $262 million in assets under management (AUM) within the first week, with most of this amount being subscribed before they were listed.
However, the actual inflows during that first week were only $14 million, which is significantly lower compared to the billions that entered US spot Bitcoin ETFs earlier in January.
This difference illustrates Hong Kong’s difficulties in establishing itself as a global center for cryptocurrency investments.
As Bloomberg ETF analyst Rebecca Sin pointed out, the city’s in-kind ETF creation model provides a unique chance to boost AUM and trading volume.
However, Hong Kong still lags behind the US market in terms of attracting investor interest and capital inflows.
