Hong Kong Launches Groundbreaking Inverse Bitcoin ETF
On July 23, Hong Kong will make history by launching Asia’s first inverse Bitcoin ETF, the CSOP Bitcoin Future Daily (-1x) Inverse Product (7376.HK). This innovative financial product, developed by CSOP Asset Management, allows investors to profit from declines in Bitcoin prices.
Innovative Financial Product by CSOP Asset Management
The ETF is designed to reflect the inverse daily performance of the S&P Bitcoin Futures Index, employing a futures-based replication strategy. This involves direct investments in spot-month Chicago Mercantile Exchange (CME) Bitcoin Futures. The product will be listed on the Hong Kong Stock Exchange (HKEX) with an initial price of approximately 7.8 Hong Kong dollars per unit.
Success of CSOP’s Bitcoin Futures ETF
This launch follows the successful introduction of CSOP’s Bitcoin Futures ETF (3066.HK) in December 2022, marking CSOP’s entry into the cryptocurrency sector within the Asia-Pacific region. The success of this initial product has paved the way for the new inverse ETF.
Hong Kong’s CSOP launched Inverse #BitcoinETFs on Monday, allowing investors to profit from #Bitcoin price declines📉🇭🇰
China is taking significant measures to boost its #crypto sector and enhance market growth🇨🇳🚀
Checkout the Article to Know More👇https://t.co/8ZJwhoRjON pic.twitter.com/OulqwiZckz
— NCBlockFiesta (@NC_Block_Fiesta) July 22, 2024
How the CSOP Bitcoin Future Daily (-1x) Inverse Product Works
The new inverse ETF comes with a trading lot of 100 units and a management fee of 1.99%. It has attracted an initial investment of around 30 million US dollars. This move aligns with the increasing volatility of Bitcoin, which has experienced fluctuations as high as 38.3% in 2023, surpassing even crude oil and the Nasdaq-100.
Hong Kong is leading the way when it comes to crypto ETFs. Hear what @ysiu of @animocabrands says about this topic on web3 deep dive podcast ➡️ https://t.co/gxCA44qSTa
This is especially relevant today with the announcement of Asia’s first #Bitcoin futures inverse product, the… pic.twitter.com/DHtdE7smJU— Rachel Wolfson (@Rachelwolf00) July 22, 2024
Rising Interest in Crypto ETFs
Hong Kong’s interest in crypto ETFs has surged since late 2022, beginning with the trading of CSOP’s Bitcoin Futures ETF and Ether Futures ETF on HKEX. These ETFs track Bitcoin and Ether futures contracts traded on the CME.
Regulatory Scrutiny and Market Implications
Amid rising regulatory scrutiny, the Hong Kong Securities and Futures Commission (SFC) recently flagged seven crypto exchanges for operating without necessary licenses, placing them on its “Suspicious Virtual Asset Trading Platforms” alert list to mitigate fraud risks. Despite these challenges, the launch of the CSOP Bitcoin Future Daily (-1x) Inverse Product represents a significant milestone in the region’s financial landscape, offering a new avenue for investors to navigate the volatile cryptocurrency market.
