Hong Kong is deliberating whether to grant retail investors direct access to spot exchange-traded funds (ETFs) focused on cryptocurrency investments. Julia Leung, CEO of the Securities and Futures Commission, revealed in an interview with Bloomberg that the regulatory body is assessing the feasibility of retail investment products in this domain as part of its commitment to embracing innovative technology to enhance efficiency and customer experience.
Leung emphasized that the regulator is willing to explore these options as long as any associated risks are properly addressed, regardless of the asset class. Her comments followed an update to the SFC’s guidance on virtual asset-related activities for intermediaries last month, expanding the range of investors who can engage with crypto ETFs. According to the circular, intermediaries must evaluate their clients’ knowledge of virtual assets through a knowledge test before allowing them to participate in transactions. Institutional professional investors and qualified corporate professional investors are exempt from this requirement.
At present, Hong Kong has three futures-based crypto ETFs listed: the Samsung Bitcoin Futures Active ETF, CSOP Bitcoin Futures ETF, and CSOP Ether Futures ETF. The city initiated its cryptocurrency licensing framework for virtual asset trading platforms in June, permitting licensed exchanges to provide retail trading services. HashKey and OSL are among the firms that have secured these licenses from the regulator.
