Bitcoin ETF

Bitcoin

Grayscale Bitcoin Trust

Hong Kong’s financial regulators aim to offer in-kind creation models for spot Bitcoin exchange-traded funds (ETFs).
This could be a significant market opportunity, which could considerably increase assets under management (AUM) and trading volume for Bitcoin ETF issuers in the region, according to a research note by Bloomberg ETF analyst Rebecca Sin, <a href="https://twitter.com/EricBalchunas/status/1772602019133423921/photo/1" target="_blank" rel="noopener nofollow">shared</a> in a March 26 X post by Eric Balchunas:
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 “Hong Kong is aiming for in-kind creation of the ETF, unlike the US, where the transaction is cash only — in the US, it’s cash in, Bitcoin ETF out, while Hong Kong aims for Bitcoin in, ETF out. This could be an opportunity for the market.”
</blockquote>
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 <img src="https://s3.cointelegraph.com/uploads/2024-03/1101d1f2-6d53-4db9-b60d-0a5a0d91cefb.png" alt="" title="">
 <figcaption style="text-align: center;">
 Hong Kong ETFs chart. Source: Eric Balchunas
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Hong Kong’s approach is in contrast with the model of the United States Securities and Exchange Commission, which only allows cash creation models for spot Bitcoin ETFs.
Related: <a href="https://cointelegraph.com/news/trad-wall-street-firms-pushing-ether-etf-approval">TradFi Wall Street firms pushing for Ether ETF approval, says former Binance Labs head</a>
The U.S. Bitcoin ETFs have amassed a total of $11.28 billion worth of flows since launch, with a net negative of $1.07 billion in net flows last week, before starting to pick up on March 25.
After five consecutive days of negative outflows last week, the spot <a href="https://cointelegraph.com/news/bitcoin-etfs-15-m-btc-price-best-close-10-days">Bitcoin ETFs saw over $15 million</a> worth of flows on March 25, the same day Bitcoin (<a href="https://cointelegraph.com/bitcoin-price">BTC</a>) price&nbsp;recorded its highest daily close of above $69,000 in the past 10 days.
Bolstered by the ETF inflows, <a href="https://cointelegraph.com/news/btc-accumulation-restarted-coinbase-btc-supply-9-year-low">Bitcoin price reclaimed $70,000</a> on March 25. As investors have resumed accumulating BTC off exchanges, BTC supply on Coinbase reached a nine-year low of 344,856 BTC on March 18.
Last week’s negative spot Bitcoin ETF inflows aren’t a long-term concern for Bitcoin holders and price actio, Bitfinex analysts told Cointelegraph:
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 “Even though negative ETF outflows featured heavily last week, all of it is from the Grayscale Bitcoin Trust (GBTC), as investors both switch out of the higher fees demanded by GBTC and also take profit, especially as many of these investors are long-term holders who entered during the bear market. GBTC investors are not the only sellers in the market. Whale wallet activities have also indicated significant profit taking.”
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Related: <a href="https://cointelegraph.com/news/6b-btc-moved-fifth-richest-bitcoin-whale">Over $6B worth of BTC moved by 5th-richest Bitcoin whale</a>

Hong Kong’s in-kind ETF creation could be a significant market opportunity: Analysts

Cointelegraph

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