UBS Group Joins HSBC to Offer Clients Crypto-related ETFs

November 10, 2023

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Global financial service provider UBS Group has decided to open some of its wealthy clients in Hong Kong to crypto-linked Exchange Traded Funds (ETFs).

In a move that matches that of HSBC, UBS Group plans to allow these selected customers to trade crypto ETFs. Ultimately, all these are in the bid and part of the push to make Hong Kong a globally recognized crypto hub.

Wealthy UBS Clients to Trade Three ETFs

Citing a source who is familiar with the matter but asked to remain anonymous, Bloomberg noted that only three digital asset futures ETFs will be made available to these UBS Group wealthy clients as of November 10th, 2023. In addition, clients are also given access to educational resources to help them better understand the risks associated with investing in these ETFs.

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Noteworthy, the ETFs are all authorized by Hong Kong’s Securities and Futures Commission (SFC) and they are Samsung Bitcoin Futures Active, CSOP Bitcoin Futures, and CSOP Ether Futures ETFs. HSBC already has these three ETFs listed on its investment platform.

Hong Kong Focused on Becoming a Digital Asset Hub

Notably, Hong Kong is in the process of developing its crypto sector to transition into a hub that protects investors and their assets.

A few months ago, Eddie Yue, the Chief Executive of the Hong Kong Monetary Authority (HKMA) hinted at the plans of the city to adopt a strict regulatory approach towards cryptocurrencies, shunning any “light touch” approach. Hong Kong was taking this bold step to mitigate the dangers linked with crypto.

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By June 1st, the robust regulatory framework was released, covering subjects like asset custody safety requirements, client asset segregation, and cybersecurity requirements. Shortly after, HKMA discovered some resistance from senior executives at traditional banks towards crypto. However, the regulator tried to convince these financial institutions to be open-minded towards crypto-related businesses.

Hong Kong Tightens Scrutiny For Crypto Businesses

Consequently, retail investors are allowed to trade major tokens including Bitcoin (BTC) and Ether (ETH) on licensed exchanges. The current hurdle is whether to permit spot crypto ETFs, especially after considering the setbacks experienced when an unlicensed JPEX exchange was accused of fraud. Hong Kong is making a conscious effort to redeem its image, hence the advent of the strict crypto rules.

In the meantime, the SFC is open to receiving “proposals using innovative technology that boosts efficiency and customer experience,” according to Julia Leung, CEO of SFC.