Harvest Fund Management’s ETF Application
The Hong Kong division of Harvest Fund Management, a major Chinese asset manager, has reportedly applied for a spot bitcoin exchange-traded fund (ETF) with the local financial regulator. This move signals Hong Kong’s readiness to embrace its first wave of spot cryptocurrency ETFs.
Launch Timeline and Regulatory Steps
According to Tencent News, Harvest Fund Management submitted its application for a spot Bitcoin ETF to the Securities and Futures Commission, aiming to launch Hong Kong’s first such ETF shortly after the Lunar New Year holiday on February 10. Both Harvest and the SFC have yet to respond to requests for comment.
Expanding Interest in Crypto ETFs
Livio Weng, COO of Hong Kong’s HashKey crypto exchange, indicated that about 10 fund companies are exploring the launch of potential spot crypto ETFs in the city. Venture Smart Financial Holdings Ltd. (VSFG) in Hong Kong also plans to launch its spot bitcoin ETF within the first quarter, as reported by Bloomberg.
Rising Interest in Stablecoins
As Hong Kong intensifies its efforts to establish stablecoin regulations, several companies, including Harvest Global Investments, RD Technologies, and VSFG, have expressed interest in stablecoin-related trials. Discussions with the Hong Kong Monetary Authority are underway regarding potential trials.
VSFG’s Involvement and Expectations
Sean Lee, senior advisor and head of stablecoin at VSFG, anticipates the commencement of the stablecoin sandbox process within the first quarter, expected to continue through the first half of 2024. VSFG aims to demonstrate the potential of programmable digital money while meeting prudential requirements.
HKMA’s Stablecoin Sandbox Initiative
The HKMA is preparing to launch a sandbox for fiat-reference stablecoin (FRS) issuers interested in issuing FRS in Hong Kong. This initiative aligns with the HKMA’s goal to support stablecoin development and ensure stability in the digital payment ecosystem.
Harvest and RD Technologies have not yet responded to inquiries regarding their involvement in stablecoin trials.
HKMA’s Stablecoin Licensing Requirements
In December, the HKMA, in collaboration with the Financial Services and the Treasury Bureau, stated that stablecoin issuers would need a license if issuing a stablecoin pegged to one or more fiat currencies in Hong Kong.
Hong Kong’s Crypto Market Growth
The developments in Hong Kong’s cryptocurrency market, from the potential launch of spot Bitcoin ETFs to the exploration of stablecoin trials, indicate a significant shift towards integrating digital finance into its financial landscape.
