Cryptocurrency exchange-traded funds (ETFs) experienced a significant surge in trading activity this week as investors eagerly await a pivotal decision from the U.S. Securities and Exchange Commission (SEC) on spot Ether ETFs.
The spot Ether ETF launched by Chinese fund manager ChinaAMC recorded net inflows exceeding HK$5 million by midday Wednesday, marking its highest since launch. This follows substantial inflows of HK$3.77 million on Tuesday. The ETF saw an impressive 1.28 million shares traded on Tuesday, a notable increase from the typical daily volume of around 500,000 shares since its April 30 launch, according to stock exchange data.
Other spot Ether ETFs in Hong Kong, managed by Harvest Global Investments, Bosera Asset Management, and HashKey Capital, also witnessed heightened trading volumes this week. All three ETFs saw their prices climb by over 18 percent on Tuesday.
Despite this week’s surge, the overall turnover of Hong Kong’s spot crypto ETFs has remained modest since their inception. This is in stark contrast to the robust trading volumes seen in the U.S. for spot Bitcoin ETFs, which received approval in January. Analysts suggest that while Hong Kong’s crypto ETFs represent a significant step in the city’s ambition to become a virtual asset hub, their impact on the global cryptocurrency market has been limited.
“The trading volume in Hong Kong’s ETF market is significantly smaller than that of the U.S.,” noted a financial analyst. “However, the launch of these ETFs—the first of their kind in Asia—is crucial for the global adoption and acceptance of virtual assets.”
This week’s uptick in trading volume coincides with a broader rally in cryptocurrency prices. Ether’s price surged over 20 percent to surpass US$3,700, while Bitcoin climbed approximately 4 percent to exceed US$71,000. These gains are attributed to growing speculation that the SEC is more likely to approve spot Ether ETFs.
Bloomberg Intelligence ETF analysts Eric Balchunas and James Seyffart recently raised their estimated probability of SEC approval for spot Ether ETFs from 25 percent to 75 percent, suggesting a significant shift in the regulator’s stance. “The increased likelihood of approval has definitely fueled investor optimism,” said another market analyst.
The SEC is expected to announce its decision on at least one of the Ether ETF applications today. If approved, these products could attract a wave of new investments, potentially mirroring the success seen with spot Bitcoin ETFs in the U.S.
The anticipation around the SEC’s decision underscores the growing importance of regulatory developments in shaping the cryptocurrency landscape. As investors and market participants eagerly await the outcome, the potential approval of spot Ether ETFs could mark a new chapter in the integration of digital assets into mainstream finance.
