Hong Kong ETFs unable to offset US selling pressure, stocks fell over 7% on 5/2

The recently launched Bitcoin and Ethereum ETFs in Hong Kong have attracted widespread attention. Despite the initial excitement, these new additions seem insufficient to counter the selling pressure from the U.S. ETFs.

Hong Kong's Trading Volume Far Below U.S.

The debut of the Hong Kong spot Bitcoin ETF was overshadowed by significant selling activities in similar funds in the U.S.

On the first day of trading for the Hong Kong ETF, with BTC and ETF combined, the trading volume was just over $12 million, a far cry from the $4.6 billion on the first day of the U.S. ETF, reflecting the smaller scale of the Hong Kong market. On May 2nd, the trading volume was 33.14 million Hong Kong dollars, equivalent to 4.24 million U.S. dollars, with both stocks falling more than 7%.

The trading volume of Hong Kong's cryptocurrency ETF is significantly lower compared to the U.S., with ChinaAMC Fund having the highest market share among the six ETFs.

Less Impact on Inflow by Hong Kong ETF

CoinShares researchers inferred the net inflow of ETFs through the net asset inflows of the Hong Kong Stock Exchange over the past week: $217 million.

Just on April 30th and May 1st, the U.S. ETFs saw outflows of $160 million and $560 million respectively.

Industry Hopes for Emulation in Other Countries

Market analysts believe that while Hong Kong's ETFs represent a pivotal moment, their current impact is limited. Industry insiders are hopeful for the ripple effects: DFG's CEO James Wo stated that as other Asian markets may emulate Hong Kong's actions, these ETFs could facilitate long-term price increases.

Although Hong Kong's entry into the cryptocurrency ETF market is historically significant, its immediate impact has not been as transformative as some had hoped. The continued dominance of U.S. ETFs and the inherent volatility of the cryptocurrency market suggest that the community should balance their expectations with cautious optimism. With the ongoing evolution of the global financial technology landscape, these diverse market interactions will undoubtedly play a key role in shaping the future trajectory of cryptocurrency prices.