Hong Kong gets inverse financial product to bet against Bitcoin

The Hong Kong exchange is launching its first Bitcoin inverse investment product, allowing investors to bet against the largest cryptocurrency by market capitalization.

The Hong Kong exchange is set to launch its first Bitcoin (BTC) inverse investment product, expanding its virtual asset offerings as it aims to strengthen its position as a leading financial centre.

According to the South China Morning Post, CSOP Asset Management’s new product, the US dollar-denominated Bitcoin Futures Daily Inverse Product, takes short positions in Bitcoin futures traded on the Chicago Mercantile Exchange. This allows investors to take advantage of declines in market prices. According to CSOP, the product is subject to significant volatility, with values ​​potentially falling by more than 20% in a single day.

The new inverse financial product follows the approval three months ago of six spot exchange-traded funds (ETFs) that invest directly in Bitcoin and Ethereum (ETH). Despite these efforts, the region has yet to attract significant trading interest and has shown modest inflows compared to the U.S. market.

Hong Kong, which was the first to introduce spot Ethereum ETFs and established a licensing regime for centralized crypto exchanges, continues to develop its regulatory framework for the crypto sector. In mid-July, financial regulators announced that they had received more than 100 applications advocating for a stablecoin licensing regime.

A majority of participants in a public consultation supported regulatory oversight to ensure the stable and responsible growth of the stablecoin ecosystem, Crypto.news reported.