Hong Kong spot Bitcoin exchange-traded funds (ETFs) have not been as successful as their U.S. counterparts since their launch, based on information from Farside Investors. The three newly-launched Bitcoin ETFs in Hong Kong gathered assets totaling $262 million, with minimal inflows of less than $14 million in the first week. On the other hand, the spot Ether ETFs in Hong Kong accumulated $54.2 million in assets and $9.3 million in inflows by May 6, without impressing investors. These ETFs were considered notable upgrades over the U.S. versions, denominated in fiat currencies and enabling in-kind transfers for the purchase and redemption of units directly via Bitcoin or Ether. The market conditions in Hong Kong, a smaller sector with slower economic growth compared to the U.S., have also impacted the ETFs' performance.
Furthermore, a survey conducted by OSL revealed that nearly 80% of crypto-savvy investors in Hong Kong aim to invest in the new spot Bitcoin and Ether ETFs. However, Mainland Chinese investors face restrictions and limitations in accessing these assets due to qualifications requirements. SoSoValue researchers highlighted the management fees of Hong Kong crypto ETFs, ranging from 0.85% to 1.99% annually after the initial teaser fee period, as significantly higher than the U.S. average of 0.25%. This poses challenges for institutional investors looking to hold onto their investments long term.
