Hong Kong: SFC Approves Bitcoin (BTC) Fund Geared Toward Institutional Investors


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According to a Bloomberg report published on April 19, 2020, Hong Kong-based Venture Smart Asia Ltd. Has launched the country’s first approved cryptocurrency fund that targets a first-year size of $100 million. The fund gives an official opportunity to institutional investors to add some Bitcoin (BTC) exposure to their portfolios.

Hong Kong Regulator Approves Bitcoin Fund

In an encouraging development for the global cryptocurrency ecosystem, Arrano Capital – Venture Smart’s blockchain arm – has announced the rollout of its Bitcoin fund. Per sources close to the matter, the firm’s BTC fund has successfully cleared Hong Kong’s regulatory and licensing hurdles to let it deal with digital assets.

It’s worthy of note that this is the first instance that Hong Kong’s financial regulator – the Securities and Futures Commission (SFC) – has approved a Bitcoin fund. Hong Kong has, for long, been a market of interest for cryptocurrency companies the world over.

It’s worth highlighting that the SFC has previously granted licenses to several crypto assets managers to carry out their business in the country. However, none of them ever met the full criteria to offer pure crypto funds geared toward institutional investors.

A Bitcoin fund with regulatory-approval will likely appeal to institutional investors who typically remain on the fence when dealing with digital asset funds. Although the fund didn’t specify any target at launch, Arrano Capital is confident of surpassing $100 million in total assets under management within the first year.

Avaneesh Acquilla, Chief Investment Officer, Arrano Capital, said the firm is mulling launching another fund later this year dealing with a basket of crypto assets.

He added:

We decided to launch this fund to address market demand from professional investors who are increasingly focused on Bitcoin as an alternative store of value. Ultimately for Bitcoin to be widely accepted and for people to trust it, there needs to be regulation.

Crypto Regulations in Hong Kong

Compared to their neighbors, China, Hong Kong have shown a significant receptive stance towards cryptocurrency businesses.

As reported by BTCManager in November last year, the SFC had introduced new regulations for Hong Kong-based cryptocurrency exchanges pertaining to areas such as KYC, anti-money laundering, and custody rules.

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