On July 23rd, Hong Kong will introduce Asia’s inaugural Bitcoin futures inverse product, the CSOP Bitcoin Future Daily (-1x) Inverse Product (7376.HK). This innovative exchange-traded fund (ETF) is the brainchild of CSOP Asset Management, one of China’s largest asset managers, and provides investors with a unique opportunity to profit from falls in Bitcoin’s price.
This comes after the notable success of the CSOP Bitcoin Futures ETF (3066.HK) which launched in December 2022. The earlier launch marked a significant expansion of the firm’s presence in the Asia-Pacific region. The goal of the new CSOP Bitcoin Futures Inverse Product is to deliver investment results that closely mirror the inverse daily performance of the S&P Bitcoin Futures Index. This goal is achieved through a futures-based replication strategy, investing directly in spot-month Bitcoin Futures on the Chicago Mercantile Exchange.
The new product will be listed on the Hong Kong Stock Exchange (HKEX), with the listing price expected to be around 7.8 Hong Kong dollars per unit, as announced in a CSOP company post on July 22nd. Tristan Frizza, Founder of Zeta Markets, stressed the growing sophistication of cryptocurrency financial products on a global scale, adding that instruments such as this have the potential to balance speculative activities and contribute to the long-term stability of the market.
Since late 2022, HKEX has traded spot crypto ETFs, following the successful introduction of Bitcoin and Ether Futures ETFs by CSOP. These products, which track Bitcoin and Ether futures cash-settled contracts traded on the CME, were followed by Samsung Asset Management Hong Kong’s Bitcoin future ETF in January 2023. As of April 29, the three futures products had resulted in HKEX crypto ETFs accumulating HK$1.3 billion, or $170 million, in assets under management.
However, it’s worth noting that on July 5th, the Hong Kong Securities and Futures Commission (SFC) issued alerts regarding seven cryptocurrency exchanges operating in the region without the necessary operational licenses. The SFC has included these exchanges on its suspicious virtual asset trading platforms alert list, as part of a broader effort to reduce the risk of fraud and scams in the crypto trading sphere.