Hong Kong will launch Asia's first Bitcoin futures inverse product, the CSOP Bitcoin Futures Daily (-1x) Inverse Product (7376.HK).

This new exchange-traded fund (ETF)** by China Southern Asset Management Co., Ltd (CSOP) is designed to allow investors to profit from Bitcoin's price declines.

ETF Details

The CSOP Bitcoin Futures Daily (-1x) Inverse Product will be listed on the Hong Kong Stock Exchange (HKEX) at an initial price of approximately one US dollar (7.8 Hong Kong dollars (HKD)) per unit.

It is designed to provide investment results that closely mirror the inverse daily performance of the S&P Bitcoin Futures Index. This is achieved through a futures-based replication strategy, which involves direct investments in spot-month Bitcoin futures traded on the Chicago Mercantile Exchange (CME).

Market Impact

Ms. Ding Chen, CEO of CSOP Asset Management, said, "As an ETF issuer esteemed by investors in the APAC region, CSOP has always aimed to offer comprehensive and diversified investment products.

We are currently the leading provider of Leveraged and Inverse products in Hong Kong, with a market share of 99%." She added that introducing the first futures-based inverse Bitcoin product in Hong Kong allows investors to profit from declines in Bitcoin's value.

This launch follows a volatile period for Bitcoin investors. The cryptocurrency's value dipped below $54,000 in early July before rebounding on optimism surrounding pro-crypto sentiments, including those tied to former President Donald Trump's potential political future.

Expansion and Growth

Introducing the CSOP Bitcoin Futures Daily (-1x) Inverse Product marks another step in CSOP's expansion within the Asia-Pacific region.

It builds on the successful launch of the CSOP Bitcoin Futures ETF (3066.HK) in December 2022, which was among the first crypto-linked ETFs in the region.

Since late 2022, HKEX has been trading spot crypto ETFs, starting with CSOP's Bitcoin Futures ETF and Ether Futures ETF. These products track Bitcoin futures and Ether futures cash-settled contracts traded on the CME.

Competitive Landscape

In January 2023, Samsung Asset Management Hong Kong also introduced a Bitcoin futures ETF. As of April 29, these ETFs have collectively amassed 1.3 billion HKD worth approximately $170 million in assets under management.

According to data compiled by Bloomberg, inverse crypto exchange-traded products have attracted approximately $106 million globally. The largest is the Short Bitcoin Strategy ETF from ProShares Advisors LLC, which has collected $62.5 million in assets and charges a 1.33% management fee.

In Hong Kong, the total assets held by the six Bitcoin and Ether ETFs now stand at $362 million. Meanwhile, the spot Bitcoin ETFs launched in the U.S. in January have collectively accumulated $60.7 billion in assets.

"As an ETF issuer esteemed by investors in the APAC region, CSOP has always aimed to offer comprehensive and diversified investment products." - Ms. Ding Chen, CEO of CSOP Asset Management