Flow

Million

On May 13, the Hong Kong ETF market experienced a significant cumulative outflow of $39.3 Million. It is the first time since the debut on May 2 that all the ETF instruments backed by BTC and ETH experienced outflow in a single day.
The Hong Kong ETF market has experienced significant outflows in a single day, just after a week of trading on the Hong Kong Stock Exchange. These outflows are raising red flags about the future of the Hong Kong ETF market.
<h2 class="wp-block-heading" id="strong-details-of-the-etf-flow-in-hong-kong-market-strong">Details of the ETF Flow in Hong Kong Market</h2>
The Bitcoin and Ethereum backed ETF products were introduced on May 2 on the Hong Kong Stock Exchange (HKEX) with an initial seed capital of $247.7 Million in BTC and $44.9 Million in ETH.
 Till date, Bitcoin ETFs have experienced an inflow of $13.8 Million in the period from May 2 to May 10. <a href="https://www.thecoinrepublic.com/2023/06/26/hsbc-allows-listed-bitcoin-and-ethereum-etfs-trade-in-hong-kong/" target="_blank" rel="noopener noreferrer nofollow">Ethereum ETFs </a>had an inflow of $4.3 Million. However, on May 13, both BTC and ETH ETFs in Hong Kong market had an outflow of $32.7 Million and $6.6 Million respectively.
It led to a collective outflow of $39.3 Million managed by Bosera Asset Management Co, ChinaAMC (HK) and Harvest Global Investments Ltd.
BTC ETFs Flows in Hong Kong
<figure class="wp-block-table aligncenter">
 <table>
 <tbody>
 <tr>
 <td>Provider</td>
 <td>Bosera</td>
 <td>AMC</td>
 <td>Harvest</td>
 </tr>
 <tr>
 <td>Ticker</td>
 <td>9008 HK</td>
 <td>3042 HK</td>
 <td>3439 HK</td>
 </tr>
 <tr>
 <td>May 13, 2024 (US$m)</td>
 <td>(7.4)</td>
 <td>(15.5)</td>
 <td>(9.8)</td>
 </tr>
 </tbody>
 </table>
</figure>
Source: Farside Investors
ETH ETFs Flows in Hong Kong
<figure class="wp-block-table aligncenter">
 <table>
 <tbody>
 <tr>
 <td>Provider</td>
 <td>Bosera</td>
 <td>AMC</td>
 <td>Harvest</td>
 </tr>
 <tr>
 <td>Ticker</td>
 <td>9009 HK</td>
 <td>3046 HK</td>
 <td>3179 HK</td>
 </tr>
 <tr>
 <td>May 13, 2024 (US$m)</td>
 <td>(5.2)</td>
 <td>(4.6)</td>
 <td>(2.3)</td>
 </tr>
 </tbody>
 </table>
</figure>
Source: Farside Investors
The outflow was higher than the total inflows in the last seven days of trading. Stated differently, the last outflow transaction even withdrew a part of seed capital.&nbsp;
“All the inflows this month were reversed and then some” said Co-founder and COO at 21st.Capital.
<center>
 <blockquote class="twitter-tweet">
 HK <a href="https://twitter.com/hashtag/Bitcoin?src=hash&amp;ref_src=twsrc%5Etfw" rel="noopener noreferrer nofollow">#Bitcoin</a> ETFs Update – Monday, May 13, 2024 1/ Today, all the ETFs lost large flows. The net outflow of -$32.7M was the largest on record Additionally, these large outflows turned the cumulative flow (ex-seed) negative. All the inflows this month were reversed &amp; then some. <a href="https://t.co/5lttJBLu83" rel="noopener noreferrer nofollow">pic.twitter.com/5lttJBLu83</a>— Sina <img src="https://s.w.org/images/core/emoji/15.0.3/72x72/1f5dd.png" alt="🗝" class="wp-smiley" style="height: 1em; max-height: 1em;"> <img src="https://s.w.org/images/core/emoji/15.0.3/72x72/26a1.png" alt="⚡" class="wp-smiley" style="height: 1em; max-height: 1em;"> 21st.Capital (@Sina_21st) <a href="https://twitter.com/Sina_21st/status/1790113076437557368?ref_src=twsrc%5Etfw" rel="noopener noreferrer nofollow">May 13, 2024</a>
 </blockquote>
 <script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</center>
<h3 class="wp-block-heading" id="strong-etf-flows-in-us-market-strong">ETF Flows in US Market</h3>
The US ETF market has observed an inflow of $66 Million. The inflows are primarily collected by the two ETF instruments, namely FBTC and BITB. The US ETF market, unlike its Hong Kong counterpart, is experiencing considerable growth amid a few outflows in some of the instruments.&nbsp;
<h3 class="wp-block-heading" id="strong-what-led-to-the-outflows-in-hk-etfs-strong">What Led to the Outflows in HK ETFs?</h3>
One of the probable reasons for the big outflow in the BTC backed ETF is decline in the prices of Bitcoin. On the same day, BTC was trading in the range of $61K.
The lower BTC price has led to a decrease in the investors’ trust in the BTC-backed money market instruments in the Hong Kong market.
However, the decline in BTC prices did not have similar impact in the US market because of the larger trading history and investors’ trust. A similar price trend was observed in Ethereum as it was also trading below $3,000.
Another probable reason for the contrasting movements in HK and USA ETF market is the size of the ETF market as the Hong Kong ETF market is much lower than the US ETF market.

Newly Launched Bitcoin, Ether ETFs in Hong Kong. A Failure?

Table of Contents

Thecoinrepublic.com

Other articles published on May 14, 2024

Vitalik Buterin Proposes New Gas Fee Model for Ethereum

Bitcoin Miners Expected to Sell BTC Amid Falling Mining Profit: Insights from Kaiko

Henrik Zeberg Predicts Strong Rally for Stocks and Cryptocurrencies

AMD Favors Windows 11, Abandons Windows 10 for Latest APUs

Poloniex Hack: $53.5 Million in ETH Laundered via Tornado Cash

Major breakdown at Coinbase! Are Your Crypto Assets in Danger?

Join our free newsletter for daily crypto updates!