Asia’s first inverse Bitcoin ETF to launch in Hong Kong amid crypto market volatility

Hong Kong is about to introduce Asia’s first crypto-linked inverse exchange-traded fund (ETF), permitting traders to wager towards Bitcoin amid market fluctuations influenced by US political developments.

CSOP Asset Administration will launch the CSOP Bitcoin Futures Each day (-1x) Inverse Product on Tuesday, marking a major growth in Hong Kong’s crypto monetary panorama. The product goals to supply traders with a technique to hedge towards or revenue from potential Bitcoin worth declines.

This launch comes as Bitcoin experiences volatility, having dropped beneath $54,000 in early July earlier than rebounding to $67,234 as of Monday afternoon in Hong Kong. The current rally has been attributed to optimism surrounding pro-crypto Donald Trump’s potential return to workplace following US President Joe Biden’s resolution to desert his reelection bid.

For Hong Kong, the inverse ETF represents one other step in its ongoing efforts to ascertain itself as a crypto-friendly hub, competing with cities like Singapore and Dubai. The town has already seen the launch of Bitcoin and Ether ETFs by asset managers together with Harvest International Investments Ltd. and a partnership between HashKey Capital and Bosera Asset Administration on April 30, although these merchandise have obtained a lukewarm reception to this point.

CSOP CEO Ding Chen expressed confidence within the new product, stating that accumulating between $50 million and $100 million in belongings for the inverse Bitcoin ETF over a few years is “undoubtedly achievable.” The agency will cost a administration price of 1.99%. Chen additionally famous that some merchants anticipate Bitcoin may attain $100,000 “very quickly” because of Trump-fueled optimism, highlighting the necessity for danger management choices for traders.

Globally, inverse crypto exchange-traded merchandise have attracted roughly $106 million thus far. The most important of those funds, the Brief Bitcoin Technique ETF from ProShares, has accrued $62.5 million in belongings with a 1.33% administration price. Hong Kong’s crypto ambitions prolong past ETFs, with authorities licensing two crypto exchanges for restricted retail buying and selling and implementing an in-kind subscription and redemption mechanism for ETF items.