Hong Kong is keeping a close watch on how the US Securities and Exchange Commission (SEC) will decide on all pending spot Bitcoin (BTC) exchange traded funds (ETFs) applications. The American regulator’s move will likely serve as a blueprint for the budding Asian crypto hub’s treatment of these financial instruments should they get similar filings.
Hong Kong Waits with Optimism
According to Animoca Brands’ Executive Chairman Yat Siu, Hong Kong’s Securities and Futures Commission (SFC) is anticipating a favorable verdict from the US SEC on all spot Bitcoin ETF filings.
“If you look at what the SFC had said about I think a month ago, it says that it was open to widen access to digital assets,” said Siu in an interview with The Block. “And frankly, Bitcoin spot ETF is, I would say, relatively uncontroversial at the end of the day.”
“I would imagine that [Hong Kong] would follow, especially because the U.S. has already done a lot of the work,” Siu commented. The Animoca Brands exec is referring to how the US SEC just laid the groundwork for the creation and redemption methods of these financial instruments.
With the final revisions of the US spot Bitcoin ETF requests due on December 29, industry watchers are doubling down on the prospect of their eventual approval by January 10, 2024.
China’s Change of Stance on Crypto
Hong Kong may very well be positioned to become the next major player in the spot Bitcoin ETF race. Although the territory already possessed a silent nod from mainland China, the more vocal support of the country’s central bank for cryptocurrency adoption could further reinforce its push in the sector.
Before the holiday, the People’s Bank of China’s (PBoC) latest report discussed how cryptocurrencies have encroached on 1% of the global financial arena. In a plot twist, it also emphasized how the nation is placing “great importance to the development of” the crypto industry in the future.
The paper likewise encouraged various governments to craft a “same business, same risks, same supervision” framework in crypto regulation.
It should be noted that China had a strong stance against cryptocurrencies over the years. Its reluctance in their adoption was attributed to their alleged risks to the nation’s national security and social stability. The tough stance of the giant Asian country was justified more during the FTX and Tether collapse in 2022.
All these narratives are set to change with the sudden U-turn of the PBoC on the way to 2024.