Can Chinese buy Hong Kong BTC ETF? Central Bank: Will open investment in legal products in Hong Kong and Macao Financial Institution

Recently, the People's Bank of China and other five departments jointly issued a document that pointed out that the Chinese authorities will "support Mainland residents in the Guangdong-Hong Kong-Macao Greater Bay Area to purchase qualified investment products sold by Hong Kong and Macao Financial Institutions through Hong Kong and Macao Financial Institutions", which is seen as a positive signal that China may allow Chinese people to buy and sell Hong Kong Cryptocurrency funds. (Background: Can Hong Kong provide virtual asset transactions to Chinese users?) (Background: Alipay's current encryption advertisement is a prelude to lifting the ban? Lawyer: China may open up the operation of coin and mining, but it is still early) The People's Bank of China issued a notice yesterday (22) stating that recently, the People's Bank of China, the Ministry of Commerce, the China Banking and Insurance Regulatory Commission, the China Securities Regulatory Commission, and the State Administration of Foreign Exchange jointly issued the "Opinions on Promoting Institutionalized Opening-up with High Standards in the Financial Field in the Pilot Free Trade Zone (Hong Kong)". Six aspects, 20 measures According to this document, the Chinese government has proposed 20 policy measures in six aspects, including "allowing foreign financial institutions to carry out new financial services of the same kind as Chinese-funded financial institutions", "making decisions on applications for related services of Financial Institutions within 120 days", "supporting the purchase of certain types of overseas financial services across borders in accordance with the law", "facilitating the transfer and import and export of related investment by foreign investors", "comprehensively strengthening financial supervision", etc., including: 1. Allowing foreign financial institutions to carry out new financial services of the same kind as Chinese-funded financial institutions: new financial services refer to financial services that have not been provided in China but have been provided and regulated in other countries or regions. The financial management department shall make a decision within a reasonable period of time and can only refuse permission for prudential reasons. When launching a new financial service, foreign financial institutions cannot be excluded from the pilot scope. 2. Decisions on applications for related services of Financial Institutions to be made within 120 days: The principle of internal and external consistency is adopted, and decisions on applications for Financial Services should be made within 120 days. Optimize administrative approval services related to securities and futures financial services. Optimize administrative approval services related to banking and insurance financial services. 3. Support the purchase of certain types of overseas financial services across borders in accordance with the law: the current areas opened up under cross-border delivery are: the banking industry is allowed to provide and transfer financial information, financial data processing and relevant software across borders; consulting, intermediary and other ancillary services. The insurance industry is allowed to provide reinsurance, international shipping, aviation and transportation insurance, large commercial insurance brokers, international shipping, aviation and transportation insurance brokers and reinsurance brokers. Pilot region enterprises and individuals can handle the renewal, claims, and surrender of cross-border insurance policies under current accounts in accordance with the law. In the Guangdong-Hong Kong-Macao Greater Bay Area, continue to optimize the cross-border wealth management connectivity pilot, support Mainland residents to purchase qualified investment products sold by Hong Kong and Macao Financial Institutions through Hong Kong and Macao Financial Institutions. Expand the range of participating institutions and the range of qualified investment products, etc. Explore payment and settlement models for Macao's new residents under the collection of dual currency of People's coin and Macao's coin. 4. Facilitate the transfer and import and export of related investment by foreign investors: allow all transfers related to investment by trial areas and foreign investors to be freely imported, exported and without delay. Continuously improve the convenience of foreign investment transactions throughout the process in trial areas. Support trial areas to include more qualified foreign-invested enterprises in the test policy coverage of trade and investment facilitation. Build a multi-functional free trade account system in Hainan Free Trade Port and the Hengqin Guangdong-Macao Depth Cooperation Zone. 5. Improve the arrangement of cross-border flow of financial data: allow Financial Institutions in trial areas to transmit data required for daily operations to overseas in accordance with the law. Formulate rules and standards for the classification and grading of data in the financial field. Support Financial Institutions and payment service providers in trial areas to study and introduce international advanced standards for electronic payment systems. Departments and staff involved shall not require the transfer or acquisition of relevant financial software source code owned by enterprises or individuals as a condition for importing, distributing, selling or using mass-market financial software or products containing such financial software. 6. Comprehensively strengthen financial supervision and effectively prevent and resolve financial risks: improve the risk monitoring, early warning, prevention, and resolution system. Establish a cross-border dispute resolution mechanism in line with international rules. Can Chinese users buy Hong Kong Cryptocurrency ETF? We know that since September 2017, the Mainland has successively halted all ICO activities within the territory and comprehensively cleared Cryptocurrency exchanges, and after issuing the Mining ban in September 2021, Cryptocurrency-related activities in China have been generally judged as illegal activities, making China one of the countries with the most restricted Cryptocurrency activities in the world. However, with the United States approving BTC and Ethereum Spot ETF for listing and trading last year, Trump publicly supporting Cryptocurrency, and even launching an official meme coin last week, many netizens began to speculate that as the United States, which has always been regarded as China's strongest opponent, shows various friendly signs towards Cryptocurrency, perhaps China will also re-evaluate Cryptocurrency, and China may have the opportunity to lift relevant bans? Now, according to this document issued by the People's Bank of China and other departments, measures such as "allowing foreign financial institutions to carry out new financial services of the same kind as Chinese-funded financial institutions" and "supporting Mainland residents in the Guangdong-Hong Kong-Macao Greater Bay Area to purchase qualified investment products sold by Hong Kong and Macao Financial Institutions through Hong Kong and Macao Financial Institutions" have aroused speculation about China's lifting of the encryption ban. Because Hong Kong also launched Spot ETF products of BTC and Ethereum last year, does this mean that Mainland investors can legally invest in Hong Kong's BTC and Spot ETF in the future? Note: Currently, Hong Kong's BTC and Ethereum ETFs have strict eligibility requirements for investors, and Chinese investors are not allowed to participate in the transactions. For example, Futu Securities requires the account opener to be a non-mainland and non-US resident. In addition, the above-mentioned measures will only be piloted in Shanghai, Guangdong, Tianjin, Fujian, Beijing Free Trade Zone and Hainan Free Trade Port and other places for the time being. How the testing situation will develop in the future and whether China will further relax remains to be observed. However, if it is really fully opened, the convenience for Chinese users to invest in BTC and Ethereum may be greatly improved.