Christopher Hui Working on Flexible ETF During European Tour

Hong Kong’s financial services secretary Christopher Hui is working on the promotion of flexible ETF during European tour.

The senior official of Hong Kong, Secretary for Financial Services and the Treasury, Christopher Hui, visited several European countries to promote the innovative technology the Asian region is developing and Hong Kong’s competitive advantage in the financial market.

Hui participated in two forums during his European tour: the South Summit in Madrid and Money 20/20 in Amsterdam. Hui underscored the significance of Hong Kong (HK) as an entrance point to the Asian market during these events. He encouraged business owners and startups to capitalize on his region’s advantageous financial conditions, including a diverse talent pool, an open and welcoming business environment, a simple and competitive tax system, and free capital movement.

The financial secretary also addressed Hong Kong’s endeavors to advance the cryptocurrency market and Web3. He elucidated the recently signed virtual asset regulations in the region, which include establishing guidelines for virtual asset businesses, including stablecoin issuers and other trading services, and implementing a licensing form for virtual asset trading platforms in the region.

The secretary referenced Hong Kong’s accomplishment in government bond financing, which was achieved through issuing two batches of tokenized green bonds. The initial batch, published last year, was the first government-issued cryptocurrency in the world. The second batch, published earlier this year, was a multi-currency offering that amassed $770 million. This was the world’s first issuance of multi-currency government green bonds in digital native form.

Hui also utilized the European tour to advocate for international tax collaboration. He expressed his apprehension regarding including Hong Kong on Portugal’s list of “obviously preferential tax jurisdictions,” which presents a greater tax risk for Hong Kong companies that conduct business there. Hui urged Portugal to remove Hong Kong from the list promptly.

Asia’s First Crypto ETF Innovation

He also addressed Hong Kong’s introduction of the first batch of six virtual asset spot exchange-traded funds (ETFs) in Asia, asserting that Hong Kong was the first to implement an in-kind redemption mechanism for these ETFs. This mechanism offers investors the flexibility to subscribe to or redeem their ETFs.

Nevertheless, the performance of HK’s ETFs has yet to match that of the United States despite these features. On Tuesday, the three Hong Kong spot bitcoin ETFs had a total daily trading volume of $6.67 million, lower than the $2.35 million and $6.08 million recorded on Friday and Thursday. Conversely, the total trading volume of United States 11-spot BTC ETFs was $1.1 billion on Monday, a decrease from the $2.51 billion recorded on Friday.

Animoca Brands Chairman Yat Siu, who is optimistic about the future of the Hong Kong Crypto ETF, disclosed that authorities in the region are currently considering the addition of staking to the spot ether ETF, which could potentially benefit the country’s digital currency, even though the ETF is still lagging in terms of trading volume.