Hong Kong Bitcoin and Ether ETFs experienced a massive outflow of $39 million on May 13, erasing two weeks of gains since their launch on May 2. Bosera, ChinaAMC, and Harvest Global’s Bitcoin ETFs were hit the hardest, with net outflows of $32.7 million. ChinaAMC’s Bitcoin fund saw the largest single outflow, losing $15.5 million. The spot Ether ETFs from the same issuers faced combined outflows of $6.6 million, with Harvest Global and ChinaAMC each seeing $3 million in outflows from their Ether ETFs.
These outflows have had an impact on Hong Kong’s crypto market, marking the third consecutive trading day of negative flows. Since May 9, total withdrawals have reached $52.5 million. This is the first instance of Harvest Global’s Bitcoin ETF experiencing outflows, totaling $9.8 million. The dip in Bitcoin’s price below $61,000, which many attribute to a post-halving slump, preceded these developments. The halving of Bitcoin mining rewards on April 20 usually results in a temporary price drop as the market adjusts to the new issuance schedule.
The scale of these outflows highlights the volatility and risk inherent in the cryptocurrency market. However, the impact on the broader market remains to be seen. Compared to the United States, the crypto ETF market in Hong Kong is relatively small. ChinaAMC’s Bitcoin fund was the biggest loser, recording outflows of $15.5 million, while Bosera and Harvest Global’s spot Bitcoin ETFs also saw significant net outflows totaling $32.7 million. The Ether ETFs faced similar outflows, with Harvest Global and ChinaAMC’s funds each experiencing $3 million in outflows.
As of Monday, all crypto ETFs collectively faced $20.9 million in total net outflows, surpassing the $18.4 million in total inflows accumulated since their launch on April 30. Hong Kong’s crypto ETF market is still small compared to the US market, with a combined $179.2 million in assets under management. The US market, on the other hand, has eleven spot Bitcoin ETFs managing over $50 billion in assets. This disparity highlights the differing scales and levels of adoption between the two markets. The recent outflows in Hong Kong highlight the market’s vulnerability and the challenges it faces in establishing stability and investor confidence.
In conclusion, the significant outflows from Hong Kong’s Bitcoin and Ether ETFs on May 13 have wiped out two weeks of inflows, revealing the volatility in the cryptocurrency market and the challenges faced by emerging markets in establishing stable and robust investment vehicles.
