Hong Kong Looks At Authorizing Crypto ETFs

Hong Kong’s Securities and Futures Commission looks set to allow the launch of exchange traded funds tracking cryptocurrency futures for retail investors, citing the increasing sophistication of investor safeguards. 

Julia Leung, deputy chief executive and executive director of intermediaries at the SFC, said the regulator was “actively looking to set up a regime to authorise ETFs that provide mainstream virtual assets with appropriate investor guardrails”. 

Related: Crypto Assets and the Challenges for Regulatory Design

In the initial stages, the SFC will only allow ETFs investing in bitcoin futures and ether futures traded on the Chicago Mercantile Exchange, Leung said during her keynote address at Hong Kong FinTech Week last week. 

The latest communication follows a joint circular from the SFC and the Hong Kong Monetary Authority in January this year that said a “limited suite” of products linked to virtual assets could be permitted for Hong Kong retail investors.