Hong Kong is set to make a landmark move on 23 July 2024 with the launch of Asia’s first Bitcoin futures inverse product, the CSOP Bitcoin Future Daily (-1x) Inverse Product (7376.HK). This relatively new financial product is the masterpiece of Hong Kong-based CSOP Asset Management Ltd., which gives investors a chance to make money on falling BTC prices. The ETF will be listed on the Hong Kong Stock Exchange (HKEX) on 22nd July, with an initial listing price of approximately 7.8 Hong Kong dollars per unit.
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A New Way to Bet Against Bitcoin
This investment vehicle, the CSOP Bitcoin Future Daily (-1x) Inverse Product, means that your returns are the exact reverse of the S&P Bitcoin Futures Index. Thus, if the price of Bitcoin drops, the value of the ETF increases, implying that the holders of the ETF will benefit when the price of Bitcoin goes down. This is done by going short on future Bitcoin contracts in the CME or the Chicago Mercantile Exchange. With values priced in US dollars, the ETF is a simple method through which investors can eliminate the BTC price drop risk.
Hong Kong’s Strategic Move to Lead in Crypto Innovation
Hong Kong has been quite active in ensuring that a friendly environment for crypto development is established. This inverse Bitcoin ETF is one of the ways Hong Kong is working towards becoming a major crypto-friendly financial center. It is necessary to note that the market of crypto urinary products and regulatory and legal frameworks has recently launched in Hong Kong. This latest addition follows the introduction of six spot Bitcoin and Ether ETFs earlier this year. Despite a lukewarm reception, these steps represent significant strides in diversifying Hong Kong’s financial offerings.
Bitcoin investors have experienced a volatile summer, with prices dropping below $54,000 in early July before rebounding to $67,234 yesterday, primarily driven by political developments in the United States. Highlighting the potential of the new inverse ETF, CSOP Asset Management’s CEO, Ding Chen, noted that this product could attract significant interest from investors in Japan, Korea, and Singapore. The firm has set ambitious targets to gather between $50 million and $100 million in assets over the next couple of years, with a management fee of 1.99%.
Ultimately, the launch of the CSOP Bitcoin Future Daily (-1x) Inverse Product marks a significant advancement for Hong Kong’s financial market, offering a unique opportunity for investors to profit from declines in Bitcoin prices. This development reflects Hong Kong’s commitment to fostering crypto innovation and diversifying its financial products. As the ETF begins trading on the HKEX, investors and market analysts will closely watch its performance and reception.
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