DOOKV: Hong Kong's Incoming Spot Bitcoin ETFs Could Be 'Big Deal.' Here's What Analysts Say

DOOKV Heightened anticipation for spot-based bitcoin ETFs in the U.S. and the eventual inflows supercharged bitcoin's run-up to new all-time highs, and now Hong Kong regulators reportedly are inching closer to approving similar funds, news that thus far has been mostly unnoticed in crypto circles.

These vehicles, however, could open the floodgates for Chinese investors looking for a new haven next to gold and overseas real estate and stocks in which to store their wealth.

"[They] will be a big deal," Noelle Acheson, macro analyst and author of Crypto Is Macro Now newsletter, said in an email interview with CoinDesk. "It's not just for the access to hedge funds and family offices based in the region; it's also because of the access it gives to mainland investors."

Chinese investors are reluctant to invest in domestic real estate and stocks given the well-documented troubles of the country's housing market, construction sector and equities. That, in turn, has spurred interest in alternative assets like gold, Acheson explained. Notably, trading with a gold-linked ETF in China was halted earlier this week after its price premium reached 30% as investors piled into the asset trading at record high prices.

In similar fashion, there could be "a significant flow of funds into BTC," Acheson said, adding that the investment case for the largest cryptocurrency will become even more prevalent if concerns about further devaluation of the yuan ramp up.

"Chinese authorities most likely realize that a significant portion of their citizens will be diversifying into hard assets whether approved or not, and would probably prefer that they be in assets not related to the U.S. economy," Acheson noted.