FameEX Hot Topics | Hong Kong Introduces Its First Inverse Bitcoin ETF Product

CSOP Asset Management, a regulated asset management company, has become the first to launch an inverse Bitcoin ETF in Hong Kong's markets, allowing traders and investors to speculate on the decline of the cryptocurrency's value. This product complements other ETF products already available, further establishing Hong Kong as an international crypto market hub.

Hong Kong, a city aiming to become an international cryptocurrency hub, is seeing a surge in cryptocurrency products. CSOP Asset Management recently announced the launch of the first inverse Bitcoin exchange-traded fund (ETF) in the market. An inverse ETF allows investors to capitalize on the negative performance of any asset, in this case, Bitcoin. CSOP’s product, the CSOP Bitcoin Futures Daily (-1x), began trading this Tuesday on Hong Kong markets.

While many analysts have predicted a bullish future for Bitcoin following recent geopolitical events, including the failed assassination attempt on former U.S. President Donald Trump and U.S. President Joe Biden dropping his reelection bid, Bitcoin prices are still expected to fall periodically. Despite this bullish forecast, CSOP Asset Management CEO Ding Chen expects these products to garner inflows of $50 to $100 million over the next two years. However, Chen cautioned that investors need to manage the risks associated with an inverse Bitcoin ETF or take a countering position, despite the complexity of such instruments in Hong Kong. Chen also mentioned that CSOP is working on launching an inverse ETH ETF.

CSOP’s offering joins other ETFs launched in Hong Kong since April, which have received inflows of $362 million—a relatively small number compared to the $60 billion raised by U.S.-based counterparts. Nevertheless, Hong Kong's ETFs allow investors to swap crypto assets for ETF participation directly, differing from the operation of U.S. ETFs. This new inverse Bitcoin ETF adds to Hong Kong’s growing array of cryptocurrency investment options, reinforcing its position as a burgeoning center for digital assets and blockchain technology.

Disclaimer: The information provided in this section is for informational purposes only, doesn't represent any investment advice or FameEX's official view.