Hong Kong’s Finance Secretary, Christopher Hui, has emphasized the flexibility provided by the in-kind subscription and redemption feature of the city’s six spot crypto exchange-traded funds (ETFs) as part of its efforts to position itself as a regional cryptocurrency hub.
This innovative feature allows investors to have greater flexibility when subscribing to and redeeming units of these ETFs. Hui, during his recent visits to Europe, highlighted Hong Kong’s Web3 policies and its unique financial advantages. He stressed that the government has put in place comprehensive regulations for crypto and tokenization, showcasing Hong Kong’s readiness to adapt to the evolving digital asset landscape.
These developments align with global trends towards efficient, low-cost payment solutions and sustainable economic transformation through green finance. Hui promoted Hong Kong’s web3 policies during his European visits, emphasizing the city’s commitment to becoming a regional cryptocurrency hub.
However, despite these efforts, the performance of Hong Kong’s spot crypto ETFs seems to be lagging compared to their U.S. counterparts. Data from The Block shows that the three Hong Kong spot bitcoin ETFs had a total daily trading volume of $6.67 million on Tuesday, while the 11 spot bitcoin ETFs in the U.S. saw $1.1 billion in total trading volume.
Hui also highlighted the issuance of the second batch of multi-currency tokenized bonds earlier this year, totaling $770 million, making them the world’s first digitally native multi-currency government green bonds. During his visits to the Netherlands, Spain, and Portugal, Hui emphasized Hong Kong’s strategic advantages under the “one country, two systems” framework.
The Financial Secretary also praised the success of Hong Kong’s startup ecosystem, which has experienced significant growth. With nearly 4,300 startups employing over 16,000 people, Hong Kong’s strategic location and regulatory initiatives position the city as a leading financial and technological innovation hub.
In discussions with European regulators and financial industry leaders, Hui outlined Hong Kong’s regulatory approach to virtual assets, including the introduction of a licensing regime for virtual asset trading platforms and regulations for stablecoin issuers and over-the-counter trading services. These measures aim to establish a comprehensive regulatory framework for the virtual asset industry.
Hui invited relevant officials and regulatory leaders to attend Hong Kong’s flagship event, the Hong Kong FinTech Week, in October, providing an opportunity for international collaboration and exchange with key stakeholders in the fintech industry. The recent Bitcoin Asia 2024 conference in Hong Kong attracted significant interest, particularly from mainland Chinese investors, showcasing the growing enthusiasm for cryptocurrency investment in the region.