Hong Kong Spot Bitcoin ETFs Do Have A 'Benefit,' Bloomberg ETF Analyst Points Out

Zinger Key Points
  • Despite a slow start, Seyffart believes the Hong Kong ETF launch could lead to future growth if Chinese investors participate.
  • Seyffart supports Commissioner Hester Peirce as the next SEC Chair due to her pro-crypto stance and regulatory perspective.

James Seyffart, an ETF research analyst at Bloomberg Intelligence, in an interview provided further perspective to the recent launch of spot Bitcoin ETFs in Hong Kong.

What Happened: In a podcast interview with Tony Edward, Seyffart discussed the recent launch of Bitcoin and Ethereum spot ETFs in Hong Kong, noting that while the volume was underwhelming compared to U.S. trading volume, it’s a step in the right direction.

“The benefit is these guys seated with a decent amount of money,” Seyffart said, referring to the $121 million and $20 million that went into China AMC’s Bitcoin BTC/USD and Ethereum ETH/USD ETFs, respectively.

Regarding the U.S. spot Bitcoin ETFs, Seyffart observed that inflows have slowed down, which he considers normal after three months of massive consecutive inflows.

“Eventually we’re going to have day after day of net outflows,” he said, adding that the interest is down but not a mass exodus.

Also Read: Bitcoin’s ‘Clock Is Ticking’: Why Edward Snowden Issues ‘Final Warning’

Why It Matters: Seyffart’s insights shed light on the current state of crypto ETFs and the potential for future growth.

He believes that while the Hong Kong launch may not have been a massive success, it sets the stage for potential future adoption, particularly if mainland Chinese investors are allowed to participate.

In the U.S., Seyffart is not optimistic about the approval of spot Ethereum ETFs in the current cycle.

“It’s just not going to happen. There’s no movement,” he said, citing a lack of feedback from the SEC to issuers.

He suggests that the SEC might lean on correlation analysis to deny the ETFs, arguing that the spot market is not sufficiently correlated with the Ethereum futures market.

Looking ahead, Seyffart believes that a change in administration or an act of Congress could help move things along more quickly.

He also suggests that SEC Chair Gary Gensler might resign in 2025, regardless of the election outcome.

“I wouldn’t be shocked… it seems kind of likely that he would leave within a year after the election,” Seyffart said.

Seyffart’s preferred choice for the next SEC Chair is Commissioner Hester Peirce, known for her pro-crypto stance.

“I agree with like 90% of her views from a personal perspective, and I just think it’s the right way to look at things,” he said, while acknowledging that it’s not guaranteed to happen.

What’s Next: This topic is set to be a focal point at the upcoming Benzinga’s Future of Digital Assets event on Nov. 19, where industry leaders will gather to discuss the implications of regulatory challenges and the steps necessary to foster a compliant and thriving digital asset ecosystem.

Read Next: Bitcoin Market In Distribution: Are We Nearing A Bottom?

This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.

Image: Shutterstock

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