Key Points
The Ethereum ETF launched by ChinaAMC in Hong Kong has seen a substantial increase in net inflows, exceeding HK$5 million as of mid-day Wednesday.
This rise follows a previous high of HK$3.77 million on Tuesday, which was the largest inflow since the ETF’s launch.
Investors are eagerly awaiting the approval of similar products in the US for the market’s second-largest cryptocurrency, Ethereum.
Record-Breaking Trading Volumes
As per a South China Morning Post report, the ETF saw over 1.28 million shares being traded on Tuesday.
This surpassed the average daily trading volume of around 500,000 since its launch on April 30.
This week, the other two spot Ethereum ETFs in Hong Kong, issued by investment firms Harvest Global, Bosera, and HashKey Capital, also experienced higher trading volumes.
All three ETFs recorded an increase of over 18 percent on Tuesday.
The launch of Hong Kong’s spot crypto ETFs was seen as a significant step in the city’s aim to become a virtual asset hub.
However, their turnover has been modest on most days since their launch, especially compared to spot Bitcoin ETFs in the US, which were approved in January.
SoSo Value data shows that on Tuesday, the total net inflow of Bitcoin Spot ETF was $306 million, marking seven consecutive days of net inflows.
Grayscale’s ETF, the Grayscale Bitcoin Trust (GBTC), had a single-day net outflow of $0.00, BlackRock’s ETF IBIT had a single-day inflow of $290 million, and the total net asset value of Bitcoin spot ETF was $58.910 billion.
ETFs are considered crucial for attracting mainstream investors to volatile virtual assets, potentially boosting prices.
However, the initial impact of Hong Kong’s ETF launches on the global cryptocurrency market has been relatively muted.
Bloomberg analysts have noted that Hong Kong’s ETF market is substantially smaller than that of the US.
Nonetheless, they maintain that the city’s spot crypto ETFs, the first in Asia, play a crucial role in the global adoption and acceptance of virtual assets.
The recent surge in Ethereum ETFs trading volume in Hong Kong coincides with a significant rally in cryptocurrency prices following reports suggesting an increased likelihood of the US Securities and Exchange Commission (SEC) approving spot Ethereum ETFs.
Bloomberg Intelligence ETF analysts Eric Balchunas and James Seyffart recently increased their estimated probability of approval for Ethereum ETFs in the US from 25 percent to 75 percent, indicating a potential shift in the SEC’s stance on these products.
ETH, the second-largest cryptocurrency by market capitalization, has experienced a price surge of over 20 percent, surpassing US$3,700 this week.
The largest cryptocurrency also climbed by approximately 4 percent, surpassing US$71,000.
