Sluggish Debut
Hong Kong’s spot Bitcoin and Ethereum exchange-traded funds (ETFs) have had a lackluster start, with trading volumes falling short of expectations. Despite large initial issuance sizes, market interest has been subdued.
Low Trading Volumes
The ChinaAMC Bitcoin ETF, Harvest BitcoinSpot ETF, and Bosera HashKey BTC ETF saw modest trading volumes on their first day. Bitcoin Spot ETFs accumulated only $8.8 million, while Ether Spot ETFs recorded a mere $2.6 million.
Overestimation of Demand
Analysts believe that issuers may have overestimated initial market demand. The lack of participation from Mainland Chinese investors, who are unable to access these ETFs, may have also contributed to the low volumes.
Contrast with US ETFs
The performance of Hong Kong’s spot ETFs stands in stark contrast to their US counterparts. US-based spot Bitcoin ETFs saw a volume of $655 million on their inaugural trading day, far exceeding the $11 million combined volume of Hong Kong’s ETFs.
Market Reaction
The lukewarm reception of Hong Kong’s ETFs has negatively impacted the broader cryptocurrency market. Bitcoin and Ether prices dropped significantly within hours of the ETFs’ launch.
