Exchange-traded fund issuers in Hong Kong are not concerned about the crypto crackdown in the United States which could result in regulators classifying Ether (ETH) as a security. 

Speaking at a press conference on April 29 on the eve of the launch of spot crypto ETFs in Hong Kong, the head of digital asset management firm China Asset Management, Zhu Haokang, and the head of custody firm OSL Digital Securities, Wayne Huang, answered questions on the new institutional investment products.

One of the more notable responses was to a question regarding the world’s first spot Ether ETF and whether the United States declaring it a security will have any impact in Hong Kong. Huang responded:

“Probably not, because whether the United States defines Ethereum as a security does not affect the independent decision-making of the Hong Kong Securities Regulatory Commission.” [translation]

He added that the Hong Kong Securities Regulatory Commission has its own set of procedures for determining whether particular crypto assets are securities and whether retail investors can trade them.

“It will not be affected by different opinions between various departments in the United States, or ultimately their own unilateral definition,” he continued.

He also emphasized why Hong Kong will be the first in the world to launch an Ethereum spot ETF, rather than the United States.

“The regulation of cryptocurrency in the United States has multiple departments speaking out at the same time, or trying to regulate it.”

“Hong Kong has already had a clear definition of Ethereum,” he said before stating that “Ethereum is not a security.” It is one of the two assets including Bitcoin that can be provided to retail investors, he said.

The U.S. Securities and Exchange Commission is currently investigating the Ethereum Foundation in a probe to determine whether it believes the asset is a security.

Related: Hong Kong spot crypto ETFs debut tomorrow: 6 things to know

In addition to China Asset Management, Bosera Asset Management, and Harvest Global Investments have launched crypto ETFs through their Hong Kong subsidiaries on the Hong Kong Stock Exchange on April 30 under the tickers CAM, BOS, and HGI.

OSL Digital Securities was chosen as the first virtual asset trading and sub-custodian partner by China Asset Management (Hong Kong) on April 15.

China Asset Management is a state-owned bank established in 1998 and headquartered in Beijing. It is also one of China’s biggest fund families.

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