April 23, 2024
By Sharan Kaur Phillora
Hong Kong-based Victory Securities has recently disclosed the proposed fee structure for its upcoming Bitcoin and Ethereum exchange-traded funds (ETFs). This move follows the local regulatory approval of cryptocurrency ETFs, marking a significant step forward in the integration of digital assets into mainstream financial services in the region.
Here’s what we know:
Despite the Hong Kong Securities and Futures Commission (SFC) not yet releasing the list of approved ETF issuers, Victory Securities has gone ahead to inform potential investors about the fee rates. For transactions involving new ETF shares in the primary market, customers could be looking at fees ranging from 0.5% to 1%, with a minimum fee threshold set at $850.
For those trading existing ETF shares in the secondary market, the firm has set lower fees—0.15% for online trades and 0.25% for trades conducted over the phone. These rates are on par with those charged by U.S. asset managers for similar cryptocurrency products. For instance, Franklin Templeton offers a 0.19% fee on its spot Bitcoin ETF, while others vary between 0.20% and 0.90%. In contrast, the Grayscale Bitcoin Trust charges a much steeper fee of 1.5%.
The approval of spot ETFs for Bitcoin and Ether by Hong Kong authorities was reported by Cointelegraph on April 15, highlighting the region’s growing acceptance of cryptocurrencies. This development has been met with enthusiasm from many within the crypto community, including several local exchanges in Hong Kong.
However, the new ETF offerings have also been met with skepticism, especially regarding their accessibility to investors from mainland China. Bloomberg ETF analyst Eric Balchunas commented that mainland investors are likely barred from purchasing these Hong Kong-listed spot bitcoin and ether ETFs due to existing restrictions on virtual assets.
This announcement places Hong Kong at the forefront of Asian financial markets in embracing cryptocurrency, potentially attracting more investors to the digital asset space while navigating the regulatory landscape.
About the author
Sharan Kaur Phillora’s thirst for knowledge has led her to study many different subjects, including NFTs and Blockchain technology – two emerging technologies that will change how we interact with each other in the future. When she isn’t exploring a new idea or concept, she enjoys reading literary masterpieces.
