Hong Kong's spot ETF market is experiencing a surge in institutional interest, but lacks support from major banks. This development comes as the region's financial regulator, the Securities and Futures Commission (SFC), has updated its guidance to allow intermediaries to offer spot ETF services to a wider range of clients ¹.

Key Points:

- _Institutional Interest_: Despite the lack of bank support, institutional investors are increasingly interested in spot ETFs, driving growth in the market.

- _Lack of Bank Support_: Major banks in Hong Kong have not yet thrown their weight behind spot ETFs, citing concerns over regulatory uncertainty and market volatility.

- _Regulatory Update_: The SFC's updated guidance allows intermediaries to offer spot ETF services to a broader range of clients, potentially expanding the market.

- _Spot ETF Applications_: Harvest Global Investments has applied for a spot-bitcoin ETF with the SFC, and other asset managers are expected to follow suit ².

- _Growth Potential_: The spot ETF market in Hong Kong has significant growth potential, driven by increasing institutional interest and regulatory support.

- _Challenges Remain_: Despite the growth potential, challenges remain, including regulatory uncertainty, market volatility, and the need for greater education and awareness among investors.

This development highlights the complex dynamics at play in Hong Kong's spot ETF market, where institutional interest is driving growth despite a lack of support from major banks. As the market continues to evolve, it remains to be seen how these factors will shape the future of spot ETFs in the region.