Chinese Investors Increase Gold ETF Premium to 30% Amid BTC ETF FOMO
In a frenzied flurry of trading activity, local investors in China are pushing the premium on the gold stock ETF to a staggering 30%. This even led to a sudden halt to trade. Additionally, Bloomberg analyst Eric Balchunas shed light on the situation, citing Bitcoin ETF FOMO (Fear of Missing Out) as the main reason.
Bloomberg Reveals Impact of Bitcoin ETF FOMO on Gold Funds in China
In a recent post on X, Balchunas noted the desperation of Chinese investors to move away from their struggling domestic economy and stock market. “Investors there are so desperate to buy things that are not linked to their economy/stocks,” Balchunas wrote. [market]was in the gutter.
This sentiment reflects Chinese investors’ growing appetite for assets perceived to be safer or less correlated with their local economic conditions. Also notable are the effects of the lack of Bitcoin ETFs in China. Balchunas notes: “For those wondering, purchasing Bitcoin ETFs is not allowed here.”
He also added: “If it were my prediction, they would be going crazy for gold and US stocks given how much FOMO they have for them (btc is easily outperforming both).” This underscores the potential enthusiasm for Bitcoin ETFs among Chinese investors who are currently channeling their FOMO into gold and US stocks. This increased the gold ETF premium to 30.49%
But Chinese investors finally have access to Spot Bitcoin ETFs, as fund managers on the mainland have applied for the funds to be approved. However, these ETFs will be available through their subsidiaries in Hong Kong, making them inaccessible to investors residing in mainland China.
Also Read: Hashkey to Blend Binance and Coinbase Features for Global Exchange
Will Hong Kong Allow Bitcoin Exchange Traded Funds?
As previously reported, a growing number of hedge fund firms are strategically using their Hong Kong subsidiaries to leverage Spot Bitcoin ETFs. According to recent reports from Securities Times, institutions such as Harvest Fund and Southern Fund’s Hong Kong subsidiaries are actively working on exploring Bitcoin ETFs.
Additionally, Harvest Fund has filed an application for a Bitcoin spot ETF with the Hong Kong Securities Regulatory Commission. Additionally, industry experts predict that we may see Bitcoin ETF applications become available as early as the second quarter of this year.
This prediction underlines the significant momentum in the sector as Hong Kong prepares to become a crypto hub. Southern Fund’s subsidiary, Southern Dongying, is known for pioneering various types of products in China’s IPO industry, such as QDII. In addition, it is expected to emerge as the leader in the Bitcoin ETF market and mark a notable turning point in the crypto space.
Southern Dongying has positioned itself as a pioneer in this emerging market by launching the first crypto ETF in Asia. The introduction of the South East UK Bitcoin Futures ETF and the South East UK Ethereum Futures ETF in Hong Kong will further increase Bitcoin adoption. Moreover, it could catalyze an upward move in BTC price trajectory.
Also Read: China Fund Submits Spot Bitcoin ETF Application in Hong Kong, Hints at Second Quarter Launch
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