Hong Kong allows crypto ETFs and makes plans to establish the VA market


  • Hong Kong plans to allow crypto ETFs linked to Bitcoin and Ether to trade on the Chicago Mercantile Exchange.
  • The country has issued a press release announcing the development of VA in the region.
  • The Securities and Futures Commission will also be launching a public consultation on how retail investors can access the VAs.

Hong Kong aspires to become the hubspot of digital assets and currencies globally. In a recent attempt to facilitate an “environment for promoting sustainable and responsible development of the VA sector in Hong Kong”, authorities have released a press release.

According to the official statement,

As an international financial center, Hong Kong is open and inclusive towards the global community of innovators engaging in VA businesses.

The authorities also said that to ensure a digital asset-friendly environment in the region they will be putting all necessary rules and guidelines to combat risks. The guidelines will be as per the international standards that will help flourish the VA innovations in Hong Kong in a sustainable manner.

The Financial Secretary, Mr Paul Chan, said,

The policy statement explains in detail our vision and approach, regulatory regimes, thoughts on investors’ exposures, and our pilot projects to embrace the technological benefits and financial innovations brought by VA. Our policy stance on VA is now clearly communicated to the global markets and it serves to demonstrate our commitment and determination to explore financial innovations together with the global VA community.

The Regulators have also unveiled their plans to establish and sustain the crypto assets market in Hong Kong. The Securities and Futures Commission is planning to allow the trading of crypto ETFs in the southern Chinese city. They will also be launching a public consultation on potentially allowing retail investors to trade virtual assets (VA).

The Secretary for Financial Services and the Treasury, Mr. Christopher Hui, said,

 We recognize the potential of DLT and Web 3.0 to become the future of finance and commerce, and under proper regulation, they are expected to enhance efficiency and transparency. The Government is prepared to embrace this future, and we welcome the clustering of Fintech and VA community and talents in Hong Kong, and we will promote the sustainable development of financial services across the whole VA value chain.

To evaluate the technological advantages offered by VA and their potential future applications in the financial markets, the government and regulators are looking into a variety of pilot projects. These initiatives include the issuing of non-fungible tokens (NFTs) for the Hong Kong Fintech Week in 2022, the tokenization of green bonds, and e-HKD.