23 February, 2024

ETF Management Firm Hang Seng Reveals Plans to Deploy Crypto in its Products

8 months ago

20 Dec, 2023

The largest ETF manager in Hong Kong, Hang Seng Investment Management, revealed that the firm is planning to deploy cryptocurrencies in existing investment products. The announcement comes just a few days after HSBC offered its customers the opportunity to purchase crypto ETFs.

HSBC is the largest bank in Hong Kong that launched support for Bitcoin and Ethereum Exchange Traded Funds (ETFs) on June 26, 2023. The bank introduced crypto ETFs with the aim of expanding access to digital asset derivatives in the emerging Asia crypto hub.

Li Peishan, the Director and Chief Executive Officer of Hang Seng Investment Management, stated that the firm does not have a clear goal to create crypto-based ETFs and is still considering the possibility of incorporating virtual currencies into existing investment products.

Peishan also discussed the demand for ETFs in the city, noting that since the launch of ETF Connect in July of last year, it has attracted a consistent net inflow of funds. Last month, the average daily asset management scale surpassed HK$12 billion, representing an 80% increase since December of last year.

With the growing demand for ETFs, HSBC emerged as the first bank in Hong Kong to allow the buying and selling of Bitcoin and ETFs listed on the Hong Kong exchange. The bank enabled access to ETFs, including CSOP Ethereum Futures ETF, CSOP Bitcoin Futures ETF, and Samsung Bitcoin Futures Active ETF.

On Monday, the ETFs were listed on HSBC Hong Kong’s mobile and online banking app, known as Easy Invest. Additionally, HSBC has launched the Virtual Asset Investor Education Centre, where investors are required to read and confirm the educational contents and risk disclosures before investing through the Easy Invest app.

The forward movement by Hong Kong’s largest bank (HSBC) and largest ETF manager (Hang Seng Investment Management) to explore the crypto sectors marks an important milestone for the city. Despite experiencing a $1.5 trillion rout last year, Hong Kong has embraced crypto with aspirations to become a crypto hub.

This year has brought relief to virtual asset firms that previously struggled to gain access to banking services. Hong Kong regulators have been pushing banks to offer services to these firms. 

It is also important to note that Hong Kong rolled out a new crypto regulatory regime that started on June 1, allowing crypto exchanges to provide trading services to individuals and institutions. The crypto regulatory regime requires individuals and institutions to obtain and comply with licenses designed to protect investors from risky practices exposed during the 2022 crash.