Hong Kong’s digital asset ETFs have seen a rise in popularity, with the total assets under management (AUM) surpassing HKD 12 billion ($1.532 billion), according to Hang Seng Investment Management CEO and board member Peishan Li. Li also stated that while there are no immediate plans to create an ETF with a virtual asset theme, the firm is closely monitoring the development of related asset classes and exploring the possibility of incorporating virtual currencies into existing investment products.
The AUM of Hong Kong crypto ETFs has grown by 80% compared to December 2022, with a daily trading volume of HKD 1.7 billion. This represents 6% of the daily trading volume of all stocks on the Stock Exchange of Hong Kong. The listing of crypto ETFs in the special administrative region of China was initially slow to gain traction when first allowed in July 2022.
In other news, Binance co-founder and former Chinese television host Yi He issued a warning against blindly following trading signals that chase higher prices. He noted that major altcoins have seen significant price declines of 80% to 90% recently. This warning comes after Binance listed the token of permissionless decentralized finance protocol Maverick, MAV, and offered perpetual MAV contracts at 20x leverage. Maverick, which launched in March and secured a $9 million funding round in June, has reached nearly $55 million in total value locked.
Amidst the retail frenzy, He also reminded investors that the price of tokens is not controlled by Binance and that they should be aware of investment risks. Despite a thaw in crypto markets, the market cap of coins and tokens excluding Bitcoin has remained stagnant at around $550 billion over the past year.
Meanwhile, the Chinese DeFi protocol Poly Network announced that it had been hacked yet again, affecting 57 different asset types across 10 blockchains. Hackers exploited a smart contract vulnerability to mint an unrestricted amount of tokens, resulting in an estimated $42 billion worth of tokens being minted, of which only $5 million have been cashed out.
In response, Poly Network requested the assistance of cybersecurity professionals and individuals with relevant knowledge. The total value locked on Poly Network plunged from $277 million to $176 million following the hack. This is not the first time Poly Network has been hacked, with a previous attack in August 2021 resulting in the theft of at least $600 million. However, the hacker returned most of the stolen funds and refused a white hat bounty.
On a positive note, Hong Kong has launched a Web3 Task Force led by Financial Secretary Paul Chan Mo-po. The task force, consisting of industry veterans, regulators, and government officials, will focus on the sustainable and responsible development of emerging Web3 technologies in Hong Kong and submit proposals to the government. Chan emphasized the potential of blockchain technology in solving various difficulties and pain points in finance, transactions, and business operations, stating that Hong Kong should embrace Web3 development under suitable regulation. Animoca Brands CEO Yat Siu has been appointed to the task force.
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