On January 10, 2024, the U.S. Securities and Exchange Commission (SEC) approved multiple applications for a Spot Bitcoin ETF.upon first daywith cumulative trading volume of $4.6 billion in stocks traded. exceed ETF approval in the US is expected to have far-reaching implications, particularly across Asian markets where investment flows are already large. Institutional investorand the pace picks up.
The question on the minds of observers, investors, and industry players is: What happens next? By looking back at what happened in the United States and looking to the East, we can better understand what to expect in markets like Hong Kong and other regional countries.
spotlight on hong kong
There is optimism about Hong Kong’s spot Bitcoin ETF approval. In January they first application The funds are from Harvest Fund Management, one of China's major asset funds. Although there was a hope that approval It would not be surprising if it takes as early as the first quarter of 2024 or at least the second quarter of 2024. Approval of traditional ETFs by the Hong Kong Securities and Futures Commission (SFC) typically takes weeks to months.
Given that Hong Kong has already approved several crypto ETF futures funds, including CSOP Bitcoin Futures, CSOP Ether Futures, and Samsung Bitcoin Futures, it is likely that the path will pave the way for spot ETF approval over time. It's natural to expect that.
At first glance, giving these approvals all makes sense. Hong Kong serves as a conduit to China's wealth and has established a regulatory environment consistent with the depth of its wealth and wealth management sector. Additionally, Hong Kong already offers Ethereum futures, so you may find Ethereum ETFs more open.
Compared to the US, the SEC is accepting applications for spot Ethereum ETFs and requires responses by May 23rd. It would be permissible to do it sooner. On February 7, the SEC issued a delayed statement.
Evaluate potential approval from other Asian countries
China, Thailand, and Singapore appear to be the only major countries in the Asia-Pacific region without a spot Bitcoin ETF in the development stage. Key Asian countries likely to follow the general path of the United States and Hong Kong include Japan, South Korea, and Australia. It's still relatively early days, but people are already showing interest in these products. Each country has slightly different regulations, so the path to approval for a cryptocurrency product will also vary.
South Korea
South Korea's Virtual Asset User Protection Act is scheduled to come into effect in July 2024. As a result, the Financial Services Commission of Korea and the Bank of Korea authority Oversee cryptocurrency exchanges and custodians. Although news articles provide conflicting information about the likelihood of spot Bitcoin approval, two key factors point to optimism.
beginning, politician People running for office are more open to the idea. Financial Supervisory Service Governor Lee Bok-hyun is next scheduled to meet with U.S. Securities and Exchange Commission Chairman Gary Gensler. May Discuss Spot Bitcoin ETF. At least this shows that South Korea is open to financial products.
Japan
Encouraging signs also exist in Japan. According to the Ministry of Economy, Trade and Industry, the national cabinet: approved the bill This will allow national investment funds and venture capital firms to acquire cryptocurrencies. If passed by Congress, this will become law. Additionally, some of the country's largest financial institutions plan to privately launch a yen-backed digital currency in July 2024 as part of a consortium of more than 70 Japanese companies..
This will be done in parallel with Japan's public pension funds. rYou mentioned recently that you were seeking information. As part of our research into new investment possibilities, we are conducting research on “illiquid assets'' such as Bitcoin. While neither of these measures would directly allow spot Bitcoin ETFs, both would serve to create a more crypto-friendly environment.
Australia
Australian enthusiasm That's because Bitcoin has “obviously changed” since the SEC's approval. Across demographics, positive sentiment toward Bitcoin increased by 25 percent, and with this news, Bitcoin's favorability increased by 100 percent, especially when looking at people over 55.Furthermore, this enthusiasm has already Exit Many Australians are now able to invest in US ETFs, and some predict that the Australian Securities Exchange will soon make similar products available.
Brisbane, Australia-based Monochrome Asset Management's launch of a spot Bitcoin ETF in the first half of 2024 is already highly anticipated, and potential approval in the US will accelerate approval.
What is holding back the increase in crypto businesses approved by regulators?
As countries develop regulations and structures for crypto products around the world, two important topics regularly emerge: anti-money laundering (AML) rules and the need for countering terrorist financing (CTF). This may be particularly important in Asia, where the threat of money laundering and terrorist financing is serious.
For example, Hong Kong and Singapore have strict requirements for exchanges wishing to obtain a virtual currency license. Transactions are then closely monitored by carefully following Know Your Customer (KYC) procedures. These are important financial centers, so a stumble could result in skipping steps or negatively impact the reputation of non-compliant companies.
In South Korea, all registered and licensed exchanges are required to have a banking partner due to concerns about money laundering and related terrorist financing by North Korea. When opening a crypto account in an Asian country, your banking details and KYC data will be linked to your crypto exchange account to achieve transparent flow of funds to meet regulatory concerns.
Approval of the Spot Bitcoin ETF would also need to address questions about market manipulation to the satisfaction of Asian regulators, a concern raised by Gensler in delaying U.S. approval. Visibility is also important to give regulators and investors confidence, which will help crypto products become a bigger part of the financial pie. These structures and guardrails can allay concerns and lay the foundation for further growth. Furthermore, secure storage of crypto goods must be well established in Asia and around the world.
All of this foundational work allows Asian countries to participate in high-demand crypto products like Spot Bitcoin and Spot Ether ETFs in a way that provides safe and secure custody and meets AML, CTF, and market manipulation concerns. There is optimism that it will be done in a way that it can be done. .
