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Hong Kong regulators on Monday approved the launch of a spot Bitcoin and Ether exchange-traded fund (ETF), following a move by the United States to bring these products to market this year, asset managers said.
Bitcoin was trading about 3% higher as of 7:11 a.m. ET after a rough weekend selloff.
Three ETF providers have been approved by the Hong Kong Securities and Futures Commission (SFC).
ChinaAMC said it has received regulatory approval to provide “virtual asset management services” and is “actively dedicating resources to the development” of a Bitcoin and Ether spot ETF. OSL Digital Securities will be ChinaAMC's custodian.
Harvest Global and Vocera International have also received SFC approval for Bitcoin and Ether ETFs, the companies said.
Hong Kong SFC did not immediately respond to an inquiry from CNBC for comment.
Although these asset managers have received the green light for ETFs, they have not yet launched any ETFs.
Following a large-scale crackdown on the cryptocurrency industry in 2021, cryptocurrency trading was effectively banned in mainland China.
However, Hong Kong is gradually becoming a regulated crypto hub to compete with places like Dubai and Singapore. It is unclear whether mainland Chinese investors will be allowed to invest in cryptocurrencies through ETFs.
Hong Kong's move comes after U.S. securities regulators approved trading in a spot Bitcoin ETF that has seen billions of dollars in inflows.
Bitcoin ETFs allow investors to be exposed to price fluctuations in an asset without owning the underlying cryptocurrency. Many commentators say ETFs will allow more traditional investors to enter the crypto market.
Hong Kong will be one of the first countries in the world to approve an Ether ETF. The U.S. Securities and Exchange Commission has not yet approved such a product, and the asset manager told CNBC last week that it did not expect the regulator to approve it.
-CNBC's Yolande Chee contributed to this report.
