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Did HSBC Just Inspire Hong Kong's Largest ETF Manager to Go Crypto?

Hang Seng eyes crypto, Fidelity takes another shot, Binance gets burned in Germany, Bitpanda splits, Azuki holders shed, and Hezbollah gets caught in a Web3 web.

June 30, 2023

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Forget crypto spring, it's now warming up to become ETF summer. For context, BlackRock set the ball rolling last week with its Bitcoin exchange-traded fund (ETF) application. WisdomTree, Invesco, and Valkyrie Digital Assets filed similar applications with the SEC shortly after.

Despite retaining a notoriously anti-crypto stance over the years, HSBC announced its support for customers to trade cryptocurrency ETFs in Hong Kong just days after hearing BlackRock's news. In doing so, HSBC became the first bank in Hong Kong to offer this service.

Is Bitcoin ETF Euphoria Dissipating? Investors Disagree
Since reaching a high of $31,410 on Friday, Bitcoin has traded within a $1,500 range. That raises a serious question: Will last week’s momentum continue in the long run?

As the largest ETF manager in Hong Kong, Hang Seng Investment Management (HSVM) has now broken its silence, revealing it is considering adopting crypto.

Li Peishan, the director and chief executive officer of Hang Seng Investment Management stated that while there is no specific objective to create a digital asset-focused ETF, it is considering the incorporation of cryptocurrencies into its existing investment products.

HSVM is a wholly-owned subsidiary of Hang Seng Bank, with a market share of over 40% based on assets under management. The firm also boasts the highest average daily turnover among Hong Kong ETF managers in 2022.

Singapore’s Web3 War With Hong Kong is Good For Business
Are you #TeamSG or #TeamHK in the crypto regional hub battle? Ultimately, it doesn’t matter.

Hang Seng's news serves as yet another chapter of TradFi's blossoming love story with crypto. With Singapore rivalling Hong Kong as a regional crypto hub, will the next chapter see crypto ETFs from the Little Red Dot? It's been quite the page-turner nonetheless.

Elsewhere:

  • Well, we weren't kidding about ETF summer. Fidelity has returned to the scene after its rejection from the SEC back in January 2022. he SEC cited the applications' failure to meet the required standards in terms of preventing fraudulent and manipulative practices and ensuring the protection of investors' and the public's interests. Now, the asset manager is seeking approval to list and trade shares of its Wise Origin Bitcoin Trust spot bitcoin ETF, joining the evergrowing list of TradFi giants filing applications for crypto ETFs.
  • Whilst TradFi is revelling in crypto ETFs, things are less rosy for Binance.   Germany's financial regulator, the Federal Financial Supervisory Authority (BaFin), has reportedly decided not to grant a custody license to the cryptocurrency exchange. The exchange has expressed its commitment to comply with BaFin's requirements and will continue engaging with regulators in Germany. Although BaFin has not revealed why it rejected Binance's license, its decision comes as Binance faces heat from regulators worldwide including the US, Belgium, France and the UK.
  • All not is lost in Europe though. European FinTech platform Bitpanda, which has secured $33 million in funding, is splitting into two separate entities. Bitpanda Pro, the cryptocurrency exchange segment of the company, has rebranded itself as One Trading and will operate as an independent entity. Bitpanda's funding round was led by Valar Ventures, with participation from MiddleGame Ventures, Speedinvest, Keyrock, and Wintermute Ventures.
  • Long-term holders of Azuki and Beanz NFTs have been selling their digital assets following the release of the new Elementals collection. Just a few days ago, the new collection's 10,000 PFPs generated $38 million worth of ETH through its sale but holders were beginning to sell below the mint price after being dissatisfied with the artwork. Now, 132 long-term Azuki holders and 89 Beanz holders sold their NFTs during or after the Elementals drop, marking an 817% increase and a 155% increase, respectively in long-term holders selling their assets.
  • The Israeli government has seized $1.7 million in cryptocurrency from wallets connected to the Iranian military and Hezbollah. The seizure was approved by Defense Minister Yoav Gallant and involved various agencies including the Mossad spy agency, military intelligence, and the Israeli police, as well as assistance from Chainalysis. Around 40 addresses were targeted, and the funds were in USDT on the TRON network. Funds were reportedly being transferred from financial facilitators to hawala services, OTC brokers, and eventually to Hezbollah-controlled addresses via mainstream exchanges.

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