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Hong Kong’s Potential Approval of Bitcoin Spot ETFs
Hong Kong is preparing to follow the United States’ lead in approving Bitcoin spot ETFs for public trading, as suggested by analysts at Bloomberg Intelligence.
What Are ‘In Kind’ Bitcoin ETFs?
The redemption model refers to how a Bitcoin ETF’s shares track the price of spot-traded BTC. Market makers must be able to redeem shares for their equivalent BTC value. This can be done through an ‘in-kind’ redemption model or an ‘in-cash’ model.
Benefits of ‘In Kind’ Model
- Lower transaction costs
- Less operating risk
- Resistance to market manipulation
- Fewer tax implications
Analyst Rebecca Sin highlighted that Hong Kong’s market could benefit significantly from the unique ‘in-kind’ characteristic.
Bitcoin ETFs in Hong Kong
Sin mentioned that the assets under management within ETFs in Hong Kong could see a substantial increase with the introduction of Bitcoin ETFs in the region.
In January, Chinese asset manager Harvest Global Investments and Hong Kong-based firm Venture Smart Financial Holdings applied to launch a Bitcoin spot ETF in Hong Kong.
Upcoming Catalysts for Bitcoin
- Halving – April
- Upcoming 13F filings for Bitcoin ETFs – April/May
- Hong Kong ETF launch – April
Ian is a cryptocurrency enthusiast blending humor with professionalism. With an engineering background and a storyteller's heart, he simplifies the blockchain world with sharp analysis and a touch of wit. At Cryptowire, he brings his unique perspective to make digital financial innovation accessible to all.
