Hong Kong ETFs...Child's Play? - #53
[Ton's Wallet offers USDT&XUDT, IoTEX,Berachain, Aark, Othentic, Teveara, ALEX, Web3Firewall, Cysic, Bitlayer, Metaplanet, Moongate, Satscreener, Openstamp,Oobit, Rails, Blackwing, Ord.io, UXTO Stack]
Welcome back to BlockchainAsia! I am Coco. It is a loaded issue.
Please read on.
Hong Kong BTC & ETH Spot ETFs…Child’s Play?
The two ETFs will officially start trading in Hong Kong on April 30, 2024.
Three issuers approved by the regulator are:
Harvest Global Investments (03439.HK,03179.HK)
China Asset Management (03042.HK, 03046.HK)
Bosera Asset Management and HashKey Capital (03008.HK,03009.HK)
From what I have learned, in theory, at this moment, no Mainland Chinese citizen can purchase the ETFs, without a Hong Kong ID and bank account, which are required to open a local brokerage account for the transactions of the ETFs.
Mainland Chinese institutions and citizens who have been qualified to trade in Hong Kong’s stock markets through the program “Southbound Stock Connect” have to wait for the green light to allocate their capital to BTC and ETH ETFs trading.
The AUM of asset and wealth management in Hong Kong was about US$3.9T by the end of 2022. The question remains, how much of it will be allocated to the ETFs?
Eric Balchunas of Bloomberg said on X, “The offering is “child’s play” compared with similar products in the US because Hong Kong is a comparatively “tiny” market. “Don’t expect a lot of flows.” Maybe he is right. But, who knows…
On a side note, the U.S. SEC is likely to deny ETH spot ETF approval in May.
Something Will Have to Give (IMF)
IMF sounds alarmed on U.S. ballooning debt: ” Something will have to give”. Bloomberg The U.S. economy is still humming forward with an annualized GDP growth of 2.5% for Q1 2024 vs. 3.4% in Q4 2023. Yahoo Finance It seems that no hard or even soft landing is on the horizon.
This chart explains how much the U.S. loaded up on debt during the pandemic - 20% of U.S. GDP. Following the Covid are two wars, Russia-Ukraine and Israel-Hamas. The national debt has reached more than $34T!
The question is what will give if something has to? I welcome your thoughts in the comment area.
Market Trends & Developments
South Korea is one of the most active crypto markets in the world. In the first quarter, the trading volume of crypto at one point surpassed the country’s stock market volume. The Block
Muneeb Ali of Stacks posted on X lately, shedding more light on Korea’s market:
Two takeaways about the Korean market: (a) the retail interest in Bitcoin & crypto is real and probably higher than in any other country, and (b) the gaming companies there take crypto integration seriously. I wouldn't be surprised if Korea leads in crypto adoption in several verticals.
Binance’s Dubai Subsidiary Binance FZE received VASP license from Dubai’s regulator VARA, an upgrade from MVP. VASP license will allow Binance FZE to offer services to both institutional and retail investors. Binance
HashKey Exchange is to launch an exchange licensed in Bermuda. Financial Times
HKbitEX Receives Approval-In-Principle For Virtual Asset Trading Platform (SFC Type 1 & 7) Licenses in Hong Kong Announcement
HashKey Capital received a license from SFC to manage retail fund products in Hong Kong. HashKey Capital
Hong Kong stablecoin FDUSD expands to SUI, in addition to Ethereum and BNB Chain. Sui Foundation
Wallet, offered by Ton Foundation on Telegram, a social media platform with 900M users, allows Telegram’s users to do p2p payments using USDT and XUDT (Tether’s digital token backed by physical gold). Wallet is not available to users in the U.S. Coindesk
Deals - Robust Deal Flows, Diverse Verticals, Bitcoin Renaissance driven by Asian Investors
IoTEX ecosystem receives a $50M investment from a group of investors including SNZ Capital and Borderless Capital. Press Release
Berachain raised $100M Series B co-led by co-led by Breven Howard Digital Dubai Branch and Framework Ventures. Bloomberg
Aark, a perpetual DEX, raised $6M from HashKey Capital, Arrington Capital, and other funds. Cointelegraph
Othentic, which simplifies AVS development on EigenLayer and Babylon Chain with pre-built components, raised a $4M Seed Round, led by Finality Capital Partners and Bryer Capital and participated by Coinbase Ventures, HashKey Capital, and others.
Tevaera, one of the first gaming projects on zkSync, raised $5M led by Laser Digital of Nomura Group with participants HashKey Capital, Fengbushi Capital, Draper Dragon, and others. Tevaera
Singapore-based crypto payments app Oobit raised $25M led by Tether’s investment arm and CMCC Global’s Titan Fund. Coindesk
Web3Firewall, an enterprise-grade security and compliance platform powered by AI for Web3 transactions, raised $2.5 Million Led By Nomura's Laser Digital, gumi Crypto Capital, and SPEILLLP, a member of Susquehanna International Group. The Defiant
Rails, a crypto DEX, raised $6.2M from Slow Ventures and Hong Kong-based VC CMCC Global, to offer perpetual futures trading outside of the U.S., a void left behind by the collapsed FTX. TechCrunch
Openstamp, a service platform built on STAMP Protocol, raised a seed round co-led by Animoca Ventures and KuCoin Venture. Press Release
Cysic, a ZK hardware startup, raised $6M, led by Polychain, other investors include HashKey Capital and ABCDE. The Block
UTXO Stack, a modular Bitcoin Layer 2 launch platform, raised seed funding led by ABCDE and SNZ Capital. Cointelegraph
BitLayer, the first BitVM-based Bitcoin Layer 2, closed a $5M seed round led by Framework Ventures and ABCDE. Decrypt
Blackwing, a modular layer 2 blockchain designed for liquidation-free leveraged DeFi trading for any asset, raised a strategic round of $4.5M led by Hashed and gumi Crypto Capital. The Defiant
Bitcoin DeFi ALEX raised $10M led by Spartan Capital. The Block
Bitcoin Ordinals explorer Ord.Io raised $2M led by Bitcoin Frontier Fund and Sora Ventures. Decrypt
Satscreener, a real-time token aggregator for the Bitcoin ecosystem, raised $500K pre-seed led by Sora Ventures and participated from Bitcoin Frontier Fund, UTXO Management, ALEX, and others. X
Metaplanet Inc., a Japanese publically traded company, purchased its initial batch of 97.85 BTC to add to its balance sheet, partnering with investors Sora Ventures, Morgan Creek Capital's Mark Yusko, and others. CoinDesk
Moongate, a Web3 modular engagement layer for Real-World activations such as ticketing, and membership, closed a $2.7M seed round led by CMCC Global’s Titan Fund, participated by Token Bay Capital and others. Moongate has over 100,000 active users. Descript
What People Say About Paris Blockchain Week and Dubai Token 2049
“Last year, most projects were either gaming or metaverse. This year, with more financial and improved infrastructure projects”. Read more
“RWA is the hottest topic in the region” Read more
Thanks for reading. Until next time.
Coco
I am Coco Kee, author of BlockchainAsia, host of BlockchainAsia Podcast, and Co-founder of Kee Global Advisors.
Email me if you want me to include your company’s stories or interview you for the Podcast. Follow me on Linkedin and Twitter.
The content in BlockchainAsia newsletters and Blockchain Podcast is for informational and educational purposes only, represents personal views and opinions, and does not constitute investment advice or recommendations.