Hong Kong regulators are reportedly close to approving staking features for spot Ethereum exchange-traded funds (ETFs). This development comes as the region continues its efforts to establish itself as a crypto hub.
Andrew Vranjes, Blockdaemon’s Head of International and Vice President, recently spoke on this potential approval during an interview at Token2049 in Singapore.
Vranjes revealed that Blockdaemon has been actively working with spot crypto ETF issuers in Hong Kong to devise staking solutions that align with regulatory requirements.
Progress In Ethereum Spot ETFs In Hong Kong
Vranjes expressed optimism about the progress, indicating that regulators might allow staking within specific guidelines. He hinted that the initial approval might be limited to certain investor categories, such as accredited investors, before potentially expanding to a broader market.
“We’re positive because of the level of conversation,” Vranjes stated, pointing out that the discussions between Blockdaemon, ETF issuers, and regulators are ongoing, involving detailed documentation and regulatory scrutiny.
Vranjes particularly revealed that Blockdaemon is deeply engaged in discussions with clients and regulators, exchanging comprehensive documents to ensure that the proposed staking solutions meet regulatory standards.
He suggested that an official announcement regarding Ethereum staking for spot ETFs in Hong Kong could be imminent, emphasizing that the current phase involves meticulous planning and compliance checks.
“We’re in that sort of fine-grained kind of motion. I think we’re closer to the announcement than further away at this stage,” Vranjes noted.
ETH Spot ETF Performance So Far
Hong Kong’s spot crypto ETF flows lag significantly behind those in the US. For instance, the combined trading volume of the three spot Ethereum ETFs in Hong Kong stood at $30,740 as of Tuesday (September 17), with no daily flows recorded.
In contrast, nine ETH ETFs in the US saw a combined trading volume of $176.26 million and net daily outflows of $15.11 million on the same day, according to SosoValue data.
📊 Ethereum ETF Tracker | 2024-09-17
🟥 Daily Total Net Inflow -$15.11M
💰 Total Value Traded $176.26M
🏦 Total Net Assets $6.41B
📊 ETF Market Value Ratio 2.27%🥇 Net Inflows/Outflows for Each ETF
🟩 ETH +$2.77M
⬜️ ETHW $0
⬜️ ETHA $0
⬜️ ETHV $0
⬜️ CETH $0
⬜️ QETH… pic.twitter.com/IXlCkAr2HI— SoSoValue Research (@SoSoValue) September 18, 2024
Vranjes suggested that Hong Kong could potentially approve Ethereum staking for ETFs before the US, noting that would not surprise him.
If Hong Kong successfully rolls out Ethereum staking for spot ETFs, it could set a precedent, potentially influencing other markets.
The US, which currently has higher trading volumes in crypto ETFs, could face pressure to adopt similar measures. The move could also boost Ethereum’s position in the global market, offering investors additional ways to generate returns.
Featured image created with DALL-E, Chart from TradingView
