Hong Kong has become the latest country to approve spot exchange-traded funds (ETF) for Bitcoin ( BTC ) and Ether ( ETH ), with local regulators issuing approvals to at least three local issuers.

The Hong Kong Securities and Futures Commission (SFC) conditionally approved its first spot BTC and ETH ETFs on April 15, Reuters reported .

At least three offshore Chinese asset managers, including Hong Kong units of Harvest Fund Management, Bosera Asset Management and China Asset Management (ChinaAMC), will launch their spot Bitcoin and Ether ETFs soon. OSL Digital Securities, a licensed digital asset platform in Hong Kong, will act as the sub-custodian for at least one issuer, ChinaAMC. 

According to the report, Hong Kong’s Harvest and Bosera received conditional approvals from the SFC, allowing them to launch the ETFs.

On the other hand, the Hong Kong unit of China Asset Management, or ChinaAMC, said it received regulatory approval to provide virtual asset management services and was developing spot ETFs of BTC and ETH.

Hong Kong’s securities regulator issues a conditional authorization letter to an ETF application if it generally satisfies its requirements, subject to various conditions, including fee payments, filing of documents and the Hong Kong Stock Exchange’s (HKEX) listing approval.

Issued in partnership with Hong Kong-based HashKey Capital, Bosera’s Bitcoin and Ether ETFs will be launched as in-kind ETFs, meaning that new ETF shares can be issued using BTC and ETH.

The in-kind creation model is opposed to the cash-create redemption model , which allows issuers to create new ETF shares only with cash. Spot Bitcoin ETFs currently use the cash-create model in the United States as local securities regulators opted for this redemption method.

Related: Hong Kong regulator fast-tracks Bitcoin spot ETF approvals

“The introduction of the virtual asset spot ETFs not only provides investors with new asset allocation opportunities but also reinforces Hong Kong’s status as an international financial center and a hub for virtual assets,” Bosera reportedly said. Meanwhile, ChinaAMC will be launching spot Bitcoin and Ether ETF trading with OSL.

Cointelegraph approached the SFC, Bosera and Harvest for a comment regarding the ETF approval but did not receive a response at the time of publication.

The new approvals follow expectations that the SFC will approve the first batch of spot Bitcoin ETFs on April 15. According to reports, HKEX will need roughly two weeks to finalize listing procedures and other arrangements after the SFC's approval.

Update April 15 2024 12:50 PM UTC: Added more information regarding the ETF issuers

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