TLDR
- Hong Kong’s Securities and Futures Commission (SFC) approved staking services for Ethereum ETFs
- China Asset Management (ChinaAMC) will launch a staking-enabled ETH ETF by May 15
- Earlier, Bosera International and HashKey Capital launched a similar fund, launching April 25
- The ETFs allow investors to earn proof-of-stake rewards through institutional platforms
- Hong Kong is positioning itself as a central digital assets hub for Asia
Hong Kong’s Securities and Futures Commission has approved staking-enabled Ethereum ETFs, marking a major shift in the region’s crypto regulations. China Asset Management (ChinaAMC) will launch its staking-enabled Ethereum ETF through a partnership with OSL Digital Securities by May 15, 2025. This follows Bosera International and HashKey Capital’s similar fund, scheduled for launch on April 25.
The approval comes shortly after the SFC’s April 7 guidance permitting licensed virtual asset trading platforms to offer staking services. This move aligns with Hong Kong’s broader efforts to establish itself as a hub for crypto and virtual assets in the Asia-Pacific region.
SFC Executive Director Christina Choi highlighted how virtual assets could drive innovation in finance during her keynote at the Hong Kong Web3 Festival 2025. The regulatory shift represents Hong Kong “rewriting the rules” of finance to accommodate digital asset innovation.
How the Staking ETFs Work
The staking architecture for ChinaAMC’s ETF utilizes OSL’s position as the first insured and SFC-licensed digital asset platform in Hong Kong. OSL partnered with Kiln, a staking platform that also powers other blockchains like Solana, Aptos, and Sui, on April 10 to bring Ethereum staking to market.
In this arrangement, OSL provides custody services with cold storage and insurance coverage. Kiln manages the validator nodes that perform consensus duties on the Ethereum network. This creates a clear separation of duties where Kiln handles validation while OSL controls the assets and reward distribution.
Thomas Zhu, head of digital assets at ChinaAMC, stated that this setup “lowers the threshold to participating in Ethereum staking.” The staking rewards generated will accrue to the ETF and be incorporated into its net asset value, benefiting all shareholders.
For investors, this means earning staking rewards without managing technical infrastructure. They can gain exposure to both Ethereum price movements and staking yields through a familiar investment vehicle.
Benefits for Investors and Hong Kong’s Crypto Ecosystem
These new ETF products transform passive Ethereum investments into active participants in the blockchain ecosystem. Investors can receive the benefits of proof-of-stake validation while relying on institutional-grade security and compliance.
The ETFs offer several advantages over direct staking. They provide higher liquidity compared to directly staked assets that may have lock-up periods. They also simplify tax reporting compared to managing staking rewards directly.
Hong Kong’s proactive stance on crypto regulation is part of a comprehensive roadmap to strengthen its position as a global hub for virtual assets. The SFC’s “ASPIRe” roadmap introduces a five-pillar frameworkâAccess, Safeguards, Products, Infrastructure, and Relationshipsâtargeting key aspects of the digital asset ecosystem.
The 12-initiative roadmap aims to foster growth in the sector while maintaining appropriate safeguards. This approach has attracted institutional players to Hong Kong’s crypto market, with more ETF providers likely to incorporate staking features to remain competitive.
These developments may spur further innovation, potentially leading to similar services for other proof-of-stake cryptocurrencies. As Hong Kong continues to build a more mature and accessible crypto investment landscape, it sends a clear message that it is open for crypto business while committed to responsible innovation.
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