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<p>Hong Kong’s Securities and Futures Commission (SFC) <a href="https://www.cryptopolitan.com/hong-kong-approves-first-btc-and-ether-etfs/" data-type="post" data-id="511708" rel="noopener noreferrer nofollow">announced</a> the issuance of conditional approvals to three asset managers to begin issuing spot Bitcoin and Ethereum exchange-traded funds (ETFs). However, Bloomberg ETF analyst Eric Balchunas has played down the excitement surrounding the recent approval of the spot BTC and ETH ETFs in Hong Kong.</p>
<h2 class="wp-block-heading" id="bloomberg-analyst-discusses-the-hong-kong-etf-market">Bloomberg analyst discusses the Hong Kong ETF market</h2>
<p>According to Bloomberg analyst, the recent approval may not be as big of a deal as people are making it out to seem. In one of his recent <a href="https://twitter.com/EricBalchunas/status/1779867078603718970" rel="noopener noreferrer nofollow" target="_blank">posts</a> on microblogging platform X, he discussed the idea flying around that the ETFs could <a href="https://www.cryptopolitan.com/hong-kong-bitcoin-etfs-25-billion-demand/" data-type="post" data-id="510331" rel="noopener noreferrer nofollow">enjoy</a> about $25 billion in inflows. He also mentioned four reasons why crypto investors would want to limit what they are expecting from the recently approved investment vehicles.</p>
<p>He noted that he saw an estimation saying the ETFs could see $25 billion inflows but he thinks the case is otherwise. In his opinion, Balchunas said that the funds would be lucky to get $500 million in inflows.</p>
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  <blockquote class="twitter-tweet" data-width="550" data-dnt="true">
   <p lang="en" dir="ltr">Latest on HK spot Bitcoin ETFs: They have been approved to exist but not launch (yet). Rumor has it launching next wk so to not compete w Dubai conf. Don't expect a lot of flows (I saw one estimate of $25b that's insane). We think they'll be lucky to get $500m. Here's why: <br>1. HK…</p>— Eric Balchunas (@EricBalchunas) <a href="https://twitter.com/EricBalchunas/status/1779867078603718970?ref_src=twsrc%5Etfw" rel="noopener noreferrer nofollow" target="_blank">April 15, 2024</a>
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<p>Explaining the reasons behind his prediction, he noted that the ETF market is very small in Hong Kong compared to the United States. Balchunas also opined that the ETFs will not allow regular retail investors in China to access the products.</p>
<h2 class="wp-block-heading" id="limitations-and-challenges-in-the-hong-kong-etf-market">Limitations and challenges in the Hong Kong ETF market</h2>
<p>The Bloomberg analyst explained that the Hong Kong ETF firms are smaller than the asset management firms in the United States. He cited BlackRock as an example, with the firm <a href="https://www.cryptopolitan.com/blackrocks-quarter-perspective-success-2024/" data-type="post" data-id="510386" rel="noopener noreferrer nofollow">boasting</a> about $10 trillion in assets under management. He explained that the United States spot Bitcoin ETFs boasts more assets than the entire Hong Kong ETF market.</p>
<p>The analyst also discussed the fees, noting that they would likely be set around the 1-2% mark compared to the US the charges are cheaper. Balchunas explained that the ecosystem in Hong Kong is fairly liquid, which will lead to the ETFs seeing wide spreads and premium discounts. In his takeaway, he pointed out that other countries cannot be compared to the United States market.</p>

Bloomberg analyst makes shocking prediction about Hong Kong’s ETFs

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