• The Hong Kong Bitcoin ETF debut generated several reactions with some experts labeling the debut performance as “terribly disappointing”.

• However, the CEO of Harvest Global Investments Han Tongli believes that these criticisms are politically motivated, and claims the potential of the Hong Kong ETFs more than double that of the US. 

The much-anticipated Hong Kong Bitcoin ETFs made a disappointing debut on April 30, with Thursday, May 9, 2024, witnessing a second consecutive daily net outflow since inception. China Asset Management’s ETF, for instance, saw 80.16 BTC ($5 million) leaving the product on May 9 with Bosera HashKey Bitcoin ETF recording an outflow of 10 BTC ($629k).

On the same day, the three ETFs had a total trading volume of $2.06 million, down from the $2.67 million witnessed on May 8 and the $9.74 million recorded on April 30. On May 8, the three Bitcoin ETFs also recorded net inflows of 101.6 BTC ($6 million) and 99.99 BTC ($6.2 million) on May 7. 

With all of these put together, some market analysts found the outcome below par as they labeled its debut and subsequent performance as “terribly disappointing”. However, the CEO of Harvest Global Investments Han Tongli objects to these comments and claims the potential of the Hong Kong ETFs more than double that of the US. Interestingly, crypto commentators subjected this comment to critical scrutiny and observed a monumental imbalance. According to data, the six Hong Kong ETFs drew almost $13 million on its debut. However, this is just 0.3% of the funds attracted by the US ETFs. 

Regardless of this “audacious remark”, Han Tongli stood by his statement and argued that, unlike the US ETFs, the Hong Kong ETFs allow in-kind transactions. This implies that investors can trade directly using cryptos. 

We are building a bridge to connect the traditional financial world to the crypto world. The US built a bridge in one direction.

Han Tongli Suggests the Hong Kong ETFs Appeal to International Investors

To witness a drastic transformation within the ETF ecosystem, Tongli suggested that the Hong Kong ETFs should appeal to international investors who have, for personal and obvious reasons, decided not to invest in the US.

According to him, the ongoing regulatory crackdown and the uncertainties surrounding the crypto ecosystem in the US have made several non-western investors reluctant to get involved. Tackling the issue from political grounds, Tongli suspected that “Hong Kong’s political status as a special administrative region of China” is the main reason for the “unfounded” criticisms. 

It’s located in China, and we’ve heard many rumors about Hong Kong; many people don’t want to see Hong Kong become more successful.

Interestingly, this coincides with the comments of the founder of Pointsville, Gabor Gurbacs, claiming that geopolitical ETF competition was “heating up.” 

Comparatively, the Spot Bitcoin ETFs in the US have amassed almost $53 billion in assets since launched. On the other hand, Hong Kong’s ETF recorded just a fraction of this amount. 

Speaking on the overall performance, Bloomberg Intelligence ETF analysts James Seyffart and Eric Balchunas have advised investors not to expect big numbers. According to them, the volume has to be understood within the context of Hong Kong’s market size. China Asset Management’s CEO Yimei Li, has also explained that the ETFs could be accessible to the Chinese market where crypto trading is currently banned as hinted by Crypto News Flash. 

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