The financial world is watching closely as Hong Kong takes a bold step into the future of digital assets. On March 25, 2025, the Securities and Futures Commission (SFC) released its Guidelines for Virtual Asset ETF Issuance, officially opening applications from April 1, with the first exchange-traded funds expected to launch by June. This landmark move positions Hong Kong as Asia’s leading hub for regulated crypto investment products — a development with far-reaching implications for global investors.
With an estimated influx of over $5 billion in institutional capital, the rollout of crypto ETFs in Hong Kong marks a pivotal shift from speculative trading to structured, compliant exposure. But which cryptocurrencies are most likely to be included? And how can investors position themselves ahead of the curve?
Let’s break down the opportunities, risks, and strategies in this new era of regulated digital finance.
🔍 What the SFC’s New Crypto ETF Rules Mean
The SFC has set clear criteria for eligibility, focusing on market maturity, transparency, and compliance:
- Eligible assets: Only top 20 market cap cryptocurrencies that pass the SFC’s “Virtual Asset Suitability Assessment.”
- Issuers: Licensed financial institutions such as China Asset Management, Southern East Money (CSOP), and OSL Group are frontrunners.
- Access: Available directly through Hong Kong stock accounts; mainland Chinese investors may participate via the “Cross-boundary Wealth Management Connect.”
This framework ensures investor protection while fostering innovation — a balanced approach that could serve as a model for other markets.
👉 Discover how to prepare for the next wave of regulated crypto investments.
🏆 Top 5 Cryptocurrencies Likely to Be Included in Hong Kong’s First Crypto ETFs
Based on regulatory alignment, liquidity, and institutional backing, here are the leading candidates:
1. Bitcoin (BTC) – 99% Probability
As the most liquid and widely recognized digital asset, BTC is virtually guaranteed a spot. China Asset Management has already filed for a spot Bitcoin ETF — a strong signal of intent.
Recent on-chain data shows whales accumulating more than 32,000 BTC at an average cost of $78,000, indicating long-term confidence.
2. Ethereum (ETH) – 95% Probability
The SFC explicitly supports smart contract platforms, and ETH’s post-merge proof-of-stake mechanism meets regulatory scrutiny for staking compliance.
An ETH ETF approval could trigger significant upside in Layer 2 ecosystems like Optimism (OP) and Arbitrum (ARB), potentially driving 30%+ gains.
3. Ripple (XRP) – 70% Probability
After resolving its legal battle with the U.S. SEC in 2024, XRP was classified as a non-security in multiple jurisdictions.
Scotiabank analysts have identified XRP as a prime candidate for cross-border payment-themed ETFs due to its real-world utility in financial remittances.
4. Solana (SOL) – 65% Probability
Despite past association with FTX, Solana continues to show robust activity — over 1.6 million daily active addresses.
Its technical committee has submitted a comprehensive compliance upgrade plan to address decentralization and custody concerns. However, vesting unlocks in April could delay inclusion if selling pressure persists.
5. Hybrid Index ETFs – Emerging Opportunity
Rumors suggest China Asset Management is developing a basket-style ETF combining BTC, ETH, and Hong Kong-listed blockchain stocks like BC Technology Group and CSOP Bitcoin Futures ETF.
Such products could offer diversified exposure and open arbitrage opportunities in small-cap digital assets like Conflux (CFX) or AllianceBlock (ACH) before index rebalancing.
🚀 Smart Investment Strategies Before the Launch
Timing is everything. Here are three actionable approaches to consider:
Strategy 1: Hold Core Assets (BTC & ETH)
These two remain the safest bets due to their high liquidity and regulatory clarity.
Recommended approach: Dollar-cost averaging (DCA) with tactical增持 when prices fall below the 30-day moving average — avoid chasing short-term spikes.
Strategy 2: Position in Supporting Ecosystems
If ETH is included, Layer 2 protocols such as Starknet (STRK) and Optimism (OP) stand to benefit.
Additionally, real-world asset (RWA) tokenization is gaining traction — BlackRock Hong Kong has filed for a tokenized bond fund, making Polygon (MATIC) and Ondo Finance (ONDO) compelling plays.
Strategy 3: Leverage Exposure via Regulated Platforms
Consider indirect exposure through equities tied to crypto infrastructure. For example:
- OSL Group (Stock Code: 863.HK): A licensed digital asset platform whose custody services will directly benefit from ETF inflows. Its share price surged 67% last month alone.
- Hedging tools: Buy BTC call options (e.g., $90K strike) while shorting overvalued meme coins to balance portfolio risk.
👉 Learn how institutional-grade platforms are shaping the future of crypto access.
⚠️ Coins Unlikely to Be Included — Know the Risks
Not all digital assets will make the cut. The SFC has strict rules against:
- Privacy coins like Monero (XMR) and Zcash (ZEC): Violate anti-money laundering (AML) requirements.
- Algorithmic stablecoins such as USTC or FRAX: Lack full asset-backed reserves; require 1:1 fiat or commodity backing.
- China-focused tokens like CFX or NEO: May be excluded initially due to policy sensitivity, despite technical merit.
Always verify compliance status via official channels — avoid relying solely on social media hype.
📊 Bull vs Bear Debate: Is This the Start of a Bull Run or “Sell the News”?
Markets often react unpredictably after major regulatory milestones.
Bull Case: Grayscale Research predicts Asian family offices will allocate heavily to Hong Kong crypto ETFs, pushing BTC toward $120,000 by year-end.
Bear Case: History shows pullbacks after ETF approvals — U.S. spot Bitcoin ETFs saw a 20% correction post-launch due to profit-taking.
The truth may lie in phases: initial volatility followed by sustained inflows as trust builds.
❓ Frequently Asked Questions
Q: When will Hong Kong crypto ETFs start trading?
A: Applications open April 1, 2025; first listings expected by June, pending final SFC review.
Q: Can mainland Chinese investors buy these ETFs?
A: Direct access is restricted, but participation via the Cross-boundary Wealth Management Connect is likely.
Q: Will altcoins beyond BTC and ETH be included?
A: Possibly — XRP and SOL are strong contenders, but only if they meet all SFC suitability standards.
Q: How does this compare to U.S. Bitcoin ETFs?
A: Hong Kong’s framework includes multiple assets and hybrid models, offering broader diversification than current U.S. single-asset BTC products.
Q: Are there tax implications for holding crypto ETFs in Hong Kong?
A: Currently, Hong Kong does not impose capital gains tax, but investors should consult professionals regarding reporting obligations.
Q: What happens if my preferred coin isn’t in the first batch?
A: Later tranches may include additional assets as regulations evolve — early exclusion doesn’t mean permanent rejection.
💡 Final Thoughts: Navigating the Road to Institutional Adoption
The launch of crypto ETFs in Hong Kong signals a turning point — one where compliance, transparency, and scalability become central to value creation.
To thrive in this environment:
- Prioritize liquidity and regulatory clarity.
- Monitor key dates: April 1 (application start), June (expected launch).
- Diversify across crypto holdings and related equities like OSL or BC Technology to hedge volatility.
While excitement is warranted, remember: this is not a sprint but a marathon. Discipline, research, and strategic positioning will define long-term success.
👉 Stay ahead with tools designed for tomorrow’s crypto investors.