Hong Kong's spot ether exchange-traded funds (ETFs) managed by ChinaAMC have experienced a notable surge in daily inflows, surpassing HK$5 million (US$640,780) by mid-day Wednesday. This increase follows a substantial inflow of HK$3.77 million on Tuesday, marking the highest since the ETF's launch. The rise in investment activity is fueled by investor anticipation of potential US approval for similar products, with Tuesday's net inflows alone hitting HK$3.77 million, highlighting a growing interest among investors.

Increased Interest in Crypto ETFs in Hong Kong

The Ether ETFs in Hong Kong have observed their most significant daily inflow since their introduction, indicating a significant moment in the region's evolving crypto market. On May 20, Hong Kong's Bitcoin ETFs also saw positive inflows totaling $6.62 million. These Bitcoin ETFs now hold 3,660 Bitcoins after just 13 days of trading, with total net assets reaching around $246 million and a total value traded of $2.78 million. Notably, the surge in Bitcoin ETF inflows was led by Bosera & HashKey, China AMC, and Harvest, underscoring the growing institutional interest and confidence in Bitcoin ETFs within Hong Kong's financial landscape.

Despite this growth, the turnover of Hong Kong's spot crypto ETFs has been relatively subdued since their launch, contrasting with the higher trading volumes seen in the US following the approval of spot Bitcoin ETFs in January. While ETFs are considered essential for attracting mainstream investors to volatile digital assets and potentially boosting prices, the initial impact of Hong Kong's ETF debuts on the global cryptocurrency market has been described as "subdued." Analysts point out that Hong Kong's ETF market is notably smaller compared to the US market.

Anticipation of US SEC's Approval for ETH and Market Influence

Bloomberg Intelligence ETF analysts Eric Balchunas and James Seyffart have raised the estimated likelihood of the SEC approving ether ETFs from 25% to 75%, signaling a potential shift in the regulatory stance. This development has sparked significant interest and optimism in the market. Currently, Ethereum (ETH) is priced at $3,748.40, with a 24-hour trading volume of $31.7 billion, reflecting a 2.42% increase in the past 24 hours and a substantial 29.16% rise over the week. With a circulating supply of 120 million ETH, Ethereum's market cap has reached $450.3 billion.

The SEC is expected to reach a decision on at least one of the ether ETF applications by May 23, a decision eagerly awaited as it could have a significant impact on market dynamics and investor sentiment towards ether ETFs, not only in the US but globally.