CSOP launches Hong Kong’s first crypto asset ETFs

Dec 16th, 2022 | By | Category: Alternatives / Multi-Asset

CSOP Asset Management has launched the CSOP Bitcoin Futures ETF (3066 HK) and CSOP Ether Futures ETF (3068 HK) on the Stock Exchange of Hong Kong, marking another watershed moment for the crypto asset industry.

Ding Chen, Chief Executive Officer of CSOP Asset Management

Ding Chen, Chief Executive Officer of CSOP Asset Management.

The actively managed ETFs provide exposure to bitcoin and ether by way of investing in futures contracts trading on the Chicago Mercantile Exchange.

According to CSOP, active management in the funds aims to provide flexibility in portfolio composition, rolling strategy, and handling of any market disruptions, thereby generating additional value for investors.

Each ETF comes with a management fee of 1.99%.

Ding Chen, Chief Executive Officer of CSOP Asset Management, commented: “Since its establishment in 2008, CSOP has been committed to bringing high-quality and creative investment tools to Hong Kong investors. Today we are the first ETF manager to bring the most cutting-edge virtual asset ETF products to Hong Kong and Asian retail investors in a flexible and transparent manner. Investors can easily track bitcoin and ether prices with the conventional investment tool of ETFs.”

The funds are the first futures-based crypto asset ETFs to list in Asia, coming to market less than two months after Hong Kong’s Securities and Futures Commission (SFC) gave the green light for retail-facing digital asset investment products.

That announcement led to a flurry of interest from prospective ETF issuers with Samsung Asset Management and Mirae Asset Global Investments also currently in the process of bringing futures-based crypto asset ETFs to market.

Directly replicating crypto asset ETFs, however, have not yet passed muster with the SFC, perhaps reflecting concerns regarding validating the ownership of these funds’ underlying tokens.

While the funds are the first futures-based crypto asset ETFs in Asia, the Australian Securities and Investments Commission approved the introduction of directly backed crypto products earlier this year. ETF Securities, in partnership with Swiss digital assets specialist 21Shares, subsequently introduced the country’s first bitcoin and ether ETFs in May.

In contrast, Singapore, the region’s other main financial hub, has recently drawn a firmer line by restricting retail access to crypto assets and sounding out an increasing number of warnings about the asset class.

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