Harvest Global Eyes China Market with Spot Bitcoin and Ethereum ETFs on Stock Connect

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Han Tongli, the Chief Executive Officer of Harvest Global Investments, indicated that his firm might seek approval to list spot Bitcoin and Ethereum exchange-traded funds (ETFs) on the Stock Connect scheme. Their listing is expected to potentially give investors from mainland China direct access to these products in about two years. 

During the Bitcoin Asia conference in Hong Kong, Han said that Harvest “doesn’t rule out” pursuing this opportunity if “everything goes smoothly and well.”

Hong Kong’s Role in Bridging Mainland China and Crypto

Launched in 2014, the Stock Connect program facilitates trading between the Hong Kong and Shanghai stock exchanges, extending their access to the ETFs with the ETF Connect scheme. Offering mainland investors exposure to Bitcoin and Ethereum through related channels is the main essential feature of Harvest’s interest in including spot crypto ETFs in the Stock Connect Scheme.

The Stock Connect Scheme is on the buzz right now because of its development amidst Beijing’s strict stance on cryptocurrencies. Although individual ownership and trading are ambiguous in legality, most commercial crypto activities are banned in mainland China. 

Nonetheless, Harvest’s potential move is to fight to foster crypto investment acceptance within regulated frameworks.

Challenges and Opportunities

Although introducing the spot Bitcoin and Ethereum ETFs in Hong Kong is significant in establishing a crypto hub, the initial reception was not good as trading volumes fell short of expectations. 

Harvest’s CEO, Han Tongli, said that many people are “still skeptical about Hong Kong’s status as a special [administrative] region,” suggesting a more cautious market approach.

Han believes that Hong Kong’s potential for growth in the crypto market lies in the city’s portrayal as a “more neutral” region. 

The CEO also mentioned the local crypto ETFs might eventually double the size of similar US-based products, though he refrained from saying when. In other words, the quicker Hong Kong can establish a virtual ecosystem, the more ETFs will succeed.

Impact on Mainland China Investors

If Harvest Global Investments succeeds in getting its spot crypto ETFs on Stock Connect, a new investment avenue for mainland Chinese investors will open up. As the regulatory environment on the mainland is quite uncertain, Stock Connect might even be a messiah in offering a regulated pathway for cryptocurrency investments. 

However, what remains uncertain is how Beijing’s policies on digital assets will affect this Scheme.