According to a report by Matrixport, the launch of spot exchange-traded funds (ETFs) based on BTC in Hong Kong could see Chinese investors’ demand for the instrument reach $25 billion.
The potential approval of the ETF on the Hong Kong market is expected to attract a significant amount of capital from mainland Chinese investors, who can access the market through the Southbound Connect program.
This program allows for transactions worth up to 500 billion Chinese yuan (equivalent to $70 billion) annually, although recent figures show that about $15-25 billion remain unspent.
The estimated demand for digital gold spot ETFs in China is based on the assumption that the average amount of unused quota from Southbound Connect over the past few years will be allocated to these types of ETFs.
Experts also pointed out that the current weakened value of the Chinese yuan against the US dollar has created a need for diversification, with the central bank’s continued purchases of gold highlighting this trend.
