China ‘does not want to miss out’: Community reacts to HK spot Bitcoin ETF news
The cryptocurrency community is excited about the Hong Kong government reportedly weighing the launch of a spot cryptocurrency exchange-traded fund (ETF) amid the ongoing regulatory pushback against such products in the United States.
Hong Kong’s potential entrance into spot crypto ETFs could be a significant development in the context of the economic confrontation between the U.S. and China, BitMEX co-founder Arthur Hayes believes.
Hayes took to X (formerly Twitter) on Nov. 6 to express excitement over competition between the two economies, emphasizing that this competition will eventually be good for Bitcoin (BTC).
“Competition is amazing. If the U.S. has its proxy asset manager, BlackRock, launching an ETF, China needs its proxy asset manager to launch one, too,” he wrote.
Competition is amazing. If the US has its proxy asset mngr, BlackRock, launching an ETF, China needs its proxy asset mngr to launch one too.
The US v China economic war is great for $BTC. pic.twitter.com/ok7xipN4M5
— Arthur Hayes (@CryptoHayes) November 6, 2023
Cryptocurrency brand Coin Bureau was also quick to react to the potential spot crypto ETF launch in Hong Kong. According to the Coin Bureau, the U.S. Securities and Exchange Commission (SEC) might be getting some pressure amid other jurisdictions like Hong Kong jumping on the bandwagon of a spot Bitcoin ETF.
“It’s a cursory tale to the SEC that if they continue to stifle capital market innovation in the United States, other countries are going to fill the void,” Coin Bureau wrote on X.
Crypto influencer Lark Davis also stressed that the latest spot crypto ETF news from Hong Kong shows that the Chinese government doesn’t want to miss out on crypto opportunities.
“Hong Kong going to get spot Bitcoin ETFs now! Chinese money does not want miss out,” Davis stated.
Hong Kong is considering allowing retail investors to access spot ETFs linked to cryptocurrencies like Bitcoin, providing regulatory concerns are met, Securities and Futures Commission CEO Julia Leung said, according to a Bloomberg report on Nov. 5. The SFC did not immediately respond to Cointelegraph’s request for comment.
Hong Kong’s potential move into spot Bitcoin ETFs comes as at least a dozen investment firms in the U.S. seek to launch similar products in the country despite long-running pushback from the Securities and Exchange Commission (SEC).
Although both Hong Kong and the U.S. have permitted crypto ETFs linked to futures contracts, the jurisdictions are yet to approve a spot crypto ETF. Unlike a futures Bitcoin ETF, which tracks futures contracts to replicate BTC prices, a spot Bitcoin ETF directly holds BTC, allowing investors to gain exposure to the asset.
Related: Spot Bitcoin ETF hype reignited zest for blockchain games: Yat Siu
The U.S. was the first to launch futures-linked crypto ETFs in 2021, with Hong Kong following in its footsteps in late 2022 with the launch of CSOP cryptocurrency futures products. Combined with the Samsung Bitcoin Futures Active ETF, Hong Kong has about $65 million in crypto ETF assets, according to Bloomberg. The futures crypto ETFs have seen low demand in Hong Kong, with their share still being tiny compared to other global crypto funds.
Hong Kong and Shanghai Banking Corporation — the biggest bank in Hong Kong — reportedly enabled its customers to buy and sell Bitcoin and Ether (ETH)-based ETFs in June 2023.
Crypto regulation — Does SEC Chair Gary Gensler have the final say?
As digital assets gain mainstream adoption, establishing a legal framework for stablecoins is a “good idea,” said US Federal Reserve Chair Jerome Powell.
In an April 16 panel at the Economic Club of Chicago, Powell commented on the evolution of the cryptocurrency industry, which has delivered a consumer use case that “could have wide appeal” following a difficult “wave of failures and frauds,” he said.
Powell delivers remarks at the Economic Club of Chicago. Source: Bloomberg Television
During crypto’s difficult years, which culminated in 2022 and 2023 with several high-profile business failures, the Fed “worked with Congress to try to get a […] legal framework for stablecoins, which would have been a nice place to start,” said Powell. “We were not successful.”
“I think that the climate is changing and you’re moving into more mainstreaming of that whole sector, so Congress is again looking […] at a legal framework for stablecoins,” he said.
“Depending on what’s in it, that’s a good idea. We need that. There isn’t one now,” said Powell.
This isn’t the first time Powell acknowledged the need for stablecoin legislation. In June 2023, the Fed boss told the House Financial Services Committee that stablecoins were “a form of money” that requires “robust” federal oversight.
Related: Stablecoins are the best way to ensure US dollar dominance — Web3 CEO
Support for stablecoin legislation is growing
The election of US President Donald Trump has ushered in a new era of pro-crypto appointments and policy shifts that could make America a digital asset superpower.
Washington’s formal embrace of cryptocurrency began earlier this year when Trump established the President’s Council of Advisers on Digital Assets, with Bo Hines as the executive director.
Hines told a digital asset summit in New York last month that a comprehensive stablecoin bill was a top priority for the current administration. After the Senate Banking Committee passed the GENIUS Act, a final stablecoin bill could arrive at the president’s desk “in the next two months,” said Hines.
Bo Hines (right) speaks of “imminent” stablecoin legislation at the Digital Asset Summit on March 18. Source: Cointelegraph
Stablecoins pegged to the US dollar are by far the most popular tokens used for remittances and cryptocurrency trading.
The combined value of all stablecoins is currently $227 billion, according to RWA.xyz. The dollar-pegged USDC (USDC) and USDt (USDT) account for more than 88% of the total market.
Magazine: Unstablecoins: Depegging, bank runs and other risks loom
An appellate court has granted a joint request from Ripple Labs and the Securities and Exchange Commission (SEC) to pause an appeal in a 2020 SEC case against Ripple amid settlement negotiations.
In an April 16 filing in the US Court of Appeals for the Second Circuit, the court approved a joint SEC-Ripple motion to hold the appeal in abeyance — temporarily pausing the case — for 60 days. As part of the order, the SEC is expected to file a status report by June 15.
The SEC’s case against Ripple and its executives, filed in December 2020, was expected to begin winding down after Ripple CEO Brad Garlinghouse announced on March 19 that the commission would be dropping its appeal against the blockchain firm. A federal court found Ripple liable for $125 million in an August ruling, resulting in both the SEC and blockchain firm filing an appeal and cross-appeal, respectively.
However, once US President Donald Trump took office and leadership of the SEC moved from former chair Gary Gensler to acting chair Mark Uyeda, the commission began dropping multiple enforcement cases against crypto firms in a seeming political shift. Ripple pledged $5 million in XRP to Trump’s inauguration fund, and Garlinghouse and chief legal officer Stuart Alderoty attended events supporting the US president.
Related: SEC dropping Ripple case is ‘final exclamation mark’ that XRP is not a security — John Deaton
Despite support for the end of the case coming from both Ripple and the SEC, the August 2024 judgment and appellate cases leave some legal entanglements. Alderoty said in March that Ripple would drop its cross-appeal with the SEC and receive a roughly $75 million refund from the lower court judgment. It’s unclear what else may result from negotiations over a settlement in appellate court.
New leadership at SEC incoming
Acting chair Uyeda is expected to step down following the US Senate confirming Paul Atkins as SEC chair on April 9.
During his confirmation hearings, lawmakers questioned Atkins about his ties to crypto, which could create conflicts of interest in his role regulating the industry. In financial disclosures, Atkins stated he had millions of dollars in assets through stakes in crypto firms, including Securitize, Pontoro and Patomak.
Magazine: SEC’s U-turn on crypto leaves key questions unanswered
Italy’s minister of economy and finance warned that US stablecoin policies are more concerning than President Donald Trump’s tariffs, citing the potential for these crypto assets to undermine the euro’s dominance in cross-border payments.
Speaking at an event in Milan, Giancarlo Giorgetti said that while trade tariffs dominate headlines, new US policies on dollar-backed stablecoins present an “even more dangerous” threat to European financial stability, according to a Reuters report.
US stablecoins allow users to invest in a widely accepted method for cross-border payments without opening a US bank account, Giorgetti said. He warned that the growing appeal of US stablecoins to Europeans should not be underestimated.
Giorgetti urged European Union lawmakers to take more steps to boost the euro’s position as an international currency. He added that the digital euro under development by the European Central Bank (ECB) will be essential to minimize the need for Europeans to resort to foreign solutions.
US lawmakers advance stablecoin bills
Presently, stablecoin regulation in the US remains fragmented. Instead of a unified framework, multiple agencies apply existing laws to regulate stablecoins. However, lawmakers are working to implement changes, with several pieces of stablecoin legislation progressing.
On April 2, the US House Financial Services Committee passed the Stablecoin Transparency and Accountability for a Better Ledger Economy (STABLE) Act. The bill is now headed to the House floor for a full vote.
The bill was introduced on Feb. 6 by Committee Chair French Hill and the Digital Assets Subcommittee Chair Bryan Steil. It would ensure that stablecoin issuers provide information on their businesses, including how their tokens are backed.
In addition, the Guiding and Establishing National Innovation for US Stablecoins (GENIUS) Act establishes rules that require issuers to maintain reserves backed one-to-one, comply with Anti-Money Laundering (AML) laws, protect consumers and boost dollar dominance in the global economy.
The GENIUS Act still requires approval by both chambers of Congress and a presidential signature before becoming law.
Related: Stablecoins are the best way to ensure US dollar dominance — Web3 CEO
ECB exec renews digital euro push
Apart from Giorgetti, ECB Executive Board member Piero Cipollone also urged European lawmakers to intensify their efforts to combat dollar-backed stablecoin dominance in Europe. On April 8, Cipollone wrote an article expressing concerns about the growing popularity of US stablecoins.
The official suggested launching a central bank digital currency to combat this threat to the euro. He said this would aid in preserving the monetary sovereignty of the eurozone.
Magazine: Memecoin degeneracy is funding groundbreaking anti-aging research
-
Sports2 years ago‘Storybook stuff’: Inside the night Bryce Harper sent the Phillies to the World Series
-
Sports1 year agoStory injured on diving stop, exits Red Sox game
-
Sports1 year agoGame 1 of WS least-watched in recorded history
-
Sports2 years agoMLB Rank 2023: Ranking baseball’s top 100 players
-
Sports4 years ago
Team Europe easily wins 4th straight Laver Cup
-
Environment2 years agoJapan and South Korea have a lot at stake in a free and open South China Sea
-
Environment2 years agoGame-changing Lectric XPedition launched as affordable electric cargo bike
-
Business3 years agoBank of England’s extraordinary response to government policy is almost unthinkable | Ed Conway