Despite initial volume concerns, Hong Kong’s crypto ETFs launch with strong assets

Quick Take

The highly anticipated Hong Kong exchange-traded funds (ETFs) tracking Bitcoin and Ethereum had their first trading day, and while the volume figures may have appeared underwhelming at first glance, senior Bloomberg ETF analyst Eric Balchunas explained that the debut was actually quite strong.

The ETFs traded a combined 87.58 million Hong Kong dollars (around $11.19 million) on their opening day. While this fell short of overly bullish expectations exceeding $100 million.

Balchunas noted that when localized, the ChinaAMC Bitcoin ETF had a $123 million haul on day one, ranking it in the top 20% of all Hong Kong ETF launches over the past three years.

“ChinaAMC bitcoin ETF took in $123m on Day One which already ranks it 6th of 82 ETFs launched in past 3yrs in HK and Top 20% overall.”

Balchunas believes one aspect causing confusion with the launch is the disparity between Day One assets and volume. He said that the Hong Kong ETFs already had assets in place before trading began on April 30 as they allowed pre-planned investors to buy shares before trading commenced.

Meanwhile, US-based ETFs had pre-planned investors buy the shares on the first day of trading to boost volume. Balchunas said:

“In the end it’s same, one method just gives you more optical bang for the buck.”

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