Hong Kong Ethereum ETF Is Now Promoted For Staking By Regulators

Key Points:

• Hong Kong regulators are engaging in talks to permit Ethereum ETFs to include staking features, departing from the cautious stance of the SEC in the US.
• Hong Kong Ethereum ETF witnesses significant net inflows, signaling growing interest in crypto ETFs despite modest turnover in the market.

Hong Kong’s financial regulator is in talks with spot Ethereum exchange-traded fund issuers to add Ethereum staking into the ETFs, Bloomberg reports.

Hong Kong Regulator Pursues Ethereum ETF Staking Talks

The move is a departure from the cautious stance the United States Securities and Exchange Commission has taken toward similar applications.

The SEC has reacted skeptically to a staking feature included in Ethereum ETF applications in the United States, and applicant companies revised their applications to remove the controversial element. But Hong Kong has been more aggressive, first approving spot Ethereum ETFs ahead of the United States and now seeking to negotiate with issuer companies to add the staking feature.

News of this development coincided with a surge in the price of ETH, which erupted to $3,900 following word of the deal.

Hong Kong Ethereum ETF Sees Surge in Investor Interest

Meanwhile, the Hong Kong Ethereum ETF launched by Chinese fund manager ChinaAMC has seen significant net inflows, reaching more than HK$5 million (US$640,780) by mid-day Wednesday. That followed Tuesday’s record HK$3.77 million net inflow — the largest since the ETF launched.

The other two Hong Kong Ethereum ETFs, issued by investment firms Harvest Global, Bosera, and HashKey Capital, have seen increased trading volumes this week as well. On Tuesday alone, the prices of all three ETFs surged more than 18%.

Encouraging signs, but generally speaking, the turnover of Hong Kong’s spot crypto ETFs has been modest since the beginning. But Hong Kong hopes to become one of the most prominent hubs for virtual assets; still, it wants to catch up with the heavy trading volumes enjoyed by spot Bitcoin ETFs trading in the United States.