‘East vs West:’ How Hong Kong Bitcoin ETF Can Cover US Losses, Execs Say
The ETF’s debut in Hong Kong generated a record daily trading volume of $12.4 million. $141M Inflows to Hong Kong Bitcoin ETFs Will Decrease US Negative Flows
On the first day of trading, April 30, Hong Kong ETFs reached a total of $12.4 million in trading volume.
First-day performance was reportedly strong in terms of AUM (assets under management), especially for ChinaAMC, which earned over $141 million in AUM.
Reacting to the performance, Bloomberg analyst Eric Balchunas noted that the $12.4 million was significant when translated into US equivalents. Part of his post on X (formerly Twitter) reads as follows:
“In total $12.4 million was traded, A LOT for that market: the equivalent of $1.6 billion in the US. Although the assets are much stronger: China AMC reports $141 million in assets (equivalent to $22 billion in the US) with $121 million in BTC and $20 million in ETH, so ETH took 14%.”
Bitcoin Performance Against Ethereum
Hong Kong saw the debut of six spot Bitcoin [BTC] and Ethereum [ETH] ETFs, the first of their kind in the Asian region. The six products came from ChinaAMC, Bosera, Hashkey and Harvest. However, the first day results show that Bitcoin gained more volume and AUM.
In the case of ChinaAMC, Bitcoin dominated with $121 million in assets (86%) compared to ETH’s $21 million.
In terms of trading volume, Bosera Hashkey Bitcoin ETF recorded HK$12.44 million, while its ETH ETF earned HK$2.48 million during the first day of trading.
For Harvest, BTC ETF spot volume reached HK$17.89 million, while ETH ETF earned HK$4.95 million. Ergo, a similar pattern was recorded across three issuers, BTC had more trading volumes than ETH.
However, ChinaAMC dominated the overall trading volumes on the first day and accounted for over 55% of the total BTC turnover.
After adjusting performance to US BTC spot ETFs, Balchunas stressed that Hong Kong’s debut was a remarkable performance:
“East vs West: The US did $740m in assets and $4.6b in trading. These are far below that but if you adjust for the size of their mkt it is dif story: equiv of $25b+ and $1.6b, respectively. For context, China AMC’s bitcoin ETF is already among Top 20% biggest in that mkt after one day.”
The first-day performance of the Hong Kong Spot Bitcoin ETF pales in comparison to its US counterparts on the same metric. However, Balchunas emphasized that the $141 million inflows from Hong Kong Bitcoin ETFs will help offset current negative flows from the United States.
According to a survey conducted on April 28 by Hong Kong-regulated cryptocurrency exchange OSL, 76.9% of cryptocurrency-savvy respondents in the city plan to invest in the new Bitcoin and Ether ETFs. “This positive investor sentiment strongly points to the growing acceptance and importance of digital assets in the region’s economy, with Hong Kong once again marking its place as a digital asset powerhouse,” commented the CEO and head of OSL Regulatory Affairs, Gary Tiu.
Despite the enthusiasm, Hong Kong cryptocurrency ETFs remain accessible only to the city’s 6.4 million adult residents. Mainland Chinese investors, who number more than 1 billion, cannot access the new ETFs unless they have a residence permit in Hong Kong.
BTC price retested the range low around $60,000 again. More volatility is expected because this week is full of action. Notably, the FOMC meeting and the quarterly US Treasury refund will take center stage in a few hours, offsetting crypto trends for the second half of 2024.
By Leonardo Perez