Crypto News – Hong Kong Unveils Asia’s Pioneering Inverse Bitcoin ETF

Crypto News – Hong Kong Leads with Asia’s First Inverse Bitcoin ETF Launch

Crypto News – On July 23, Hong Kong will debut Asia’s first Bitcoin futures inverse product, the CSOP Bitcoin Futures Daily (-1x) Inverse Product (7376.HK). This groundbreaking exchange-traded fund (ETF), launched by CSOP Asset Management, aims to provide investors with a mechanism to profit from declines in Bitcoin’s price.

Product Overview and Objectives

The CSOP Bitcoin Futures Daily (-1x) Inverse Product is designed to deliver returns that mirror the inverse of the daily performance of the S&P Bitcoin Futures Index. Utilizing a futures-based replication strategy, the ETF invests directly in spot-month Chicago Mercantile Exchange (CME) Bitcoin Futures. This approach allows the ETF to offer investors a way to benefit from downward movements in Bitcoin prices.

According to a CSOP company announcement on July 22, the ETF will be listed on the Hong Kong Stock Exchange (HKEX) at an initial price of approximately 7.8 Hong Kong dollars per unit.

Expanding CSOP’s Presence in Asia

This launch follows the successful introduction of the CSOP Bitcoin Futures ETF (3066.HK) in December 2022, marking a significant step in the firm’s expansion within the Asia-Pacific region. The new inverse product complements CSOP’s existing offerings, providing a broader range of investment options for those looking to hedge against Bitcoin price declines.

Growth of Crypto ETFs in Hong Kong

Since the launch of the CSOP Bitcoin Futures ETF and Ether Futures ETF in late 2022, HKEX has been active in the crypto ETF space. These ETFs track BTC and ETH futures cash-settled contracts traded on the CME. In January 2023, Samsung Asset Management Hong Kong introduced its Bitcoin Futures ETF, further expanding the market.

As of April 29, 2024, the combined assets under management for these HKEX crypto ETFs reached 1.3 billion HKD (approximately $170 million).

Regulatory Developments and Challenges

On July 5, 2024, the Hong Kong Securities and Futures Commission (SFC) issued warnings regarding seven unregulated crypto exchanges operating illegally in the region. These exchanges were flagged for providing services without proper operational licenses and were listed under the “Suspicious virtual asset trading platforms” category. The SFC’s efforts aim to mitigate risks related to fraud and scams by maintaining a public record of registered, unregistered, and illegal crypto trading entities.

Frequently Asked Questions (FAQs) about Hong Kong’s First Inverse Bitcoin Futures ETF

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