jakiro
Original source: TAXDAO
Since the US Securities and Exchange Commission approved the first batch of 11 spot Bitcoin ETFs on January 10, the Hong Kong financial market has also made new progress in incorporating virtual assets.A few days ago, it is reported that the Hong Kong Securities Regulatory Commission is accelerating the first Hong Kong Bitcoin spot ETF, and plans to be listed on the Hong Kong Stock Exchange after the Spring Festival.
This article will analyze Hong Kong Futures Bitcoin ETF regulatory policies, the current status of the existing virtual currency futures ETF, and the tax policy of investing in Bitcoin Futures ETF in Hong Kong and Singapore.Discuss the development trend of Hong Kong cryptocurrency ETF in the future.
1. Hong Kong Futures Bitcoin ETF Regulatory Policy
On October 31, 2022, the Hong Kong government issued a policy declaration on the development of virtual assets in Hong Kong, clarifying the government’s policy stance and policy set by the government’s development of virtual asset industries and ecosystems in Hong Kong.At the same time, the Hong Kong Securities Regulatory Commission issued a communication letter on the Virtual Asset Futures Exchange Sale Fund (ETF), considering the authorization of the exchanges (ETF) regulations that are mainly authorized through futures contracts.The “Communication Letter to Investment in Virtual Assets Investment of Virtual Assets” issued by the CSRC issued on December 22, 2023 replaced and updated the “Communication for Sale Fund for Virtual Asset Futures Exchange”.10% of public fund products are related to management companies, investment virtual assets, subscriptions and redemption of virtual assets, investment strategies, capital custody, spot virtual asset valuations, and service providers.
1.1 Conditions for convening
① The issuer’s qualifications: In terms of management of virtual asset funds (virtual assets accounted for more than 10% of funds), the management company must have good compliance records, and at least one employee has experience in managing virtual assets or related products.Management companies must meet the existing or new requirements of virtual asset management companies in hair license regulatory agencies, and need to hold the 9 -license plate of upgrades.That is, the issuing company needs to meet the “Terms and Conditions for the Licensed Registration Institutions Applicable to Management of Investment Groups that manage investment in virtual assets”.
② Casting agency: In terms of custody agencies, virtual asset funds recognized by the Hong Kong Securities Regulatory Commission must use virtual asset platforms or financial institutions recognized by the Hong Kong Securities Regulatory Commission for virtual asset custody.Relevant virtual asset platforms or financial institutions must meet the requirements of the Hong Kong HKMA’s custodian institutions.Similar to transactions, virtual assets require third -party independent custody, and custoders must be Hong Kong licensed exchanges or financial institutions and its subsidiaries recognized by HKMA. In addition, they need to be satisfied:
The custody account must be separated from the own account of the asset management company;
Most assets are placed in a cold wallet, and a small part is placed in a hot wallet to sink to redeem;
The security key is safe and requires that the private key must be stored in Hong Kong to effectively prevent external attacks and proper backup.
③ Service provider: In terms of service providers, the Hong Kong Securities Regulatory Commission requires that virtual asset fund management companies should ensure that all necessary service providers (such as fund managers, municipal merchants and index providers, etc.) must have the Hong Kong Securities Regulatory Commission aboutRelated qualifications for the operation and service of virtual asset funds.
④ Investment strategy requirements: In terms of futures investment, the Hong Kong Securities Regulatory Commission pointed out that companies that manage virtual asset funds must ensure that related virtual asset futures have sufficient liquidity.At the same time, the exhibition cost of related virtual asset futures (ROLL COST) is controllable, and the virtual asset fund company shall explain the management methods of these exhibition costs.For funds that mainly adopt futures investment strategies, the Hong Kong Securities Regulatory Commission stated that virtual asset funds authorized by the Securities Regulatory Commission should adopt an active investment strategy to make the investment portfolio be flexible (such as diversified and multiple maturity days), and at the same timeWith the ability of exhibition strategies and the ability to deal with any market interference.At the same time, in terms of leverage investment, the Hong Kong Securities Regulatory Commission clearly stated that the virtual asset fund authorized by the Securities Regulatory Commission shall not invest in virtual assets at the fund level.
⑤ Virtual asset valuation: In terms of valuation of virtual assets, the Hong Kong Securities Regulatory Commission pointed out that for the valuation of virtual assets, the virtual asset fund management company authorized by the Securities Regulatory Commission should adopt a transaction method based on the main trading platform (that is, the foundation can reflect the basisA large share of spot trading activities and the reference index issued by suppliers with good reputation) are valued.
⑥ Risk disclosure and investor education: “Communication” requires the issuer to disclose risk disclosure in various links in the distribution documents and financial reports, and at the same time require the issuer and distributor to conduct investor education before launching products.
⑦ Audit system: According to the requirements of “Communication”, it is necessary to issue or plan to invest in funds with a total asset value of 10% or more in virtual currencies. The Hong Kong Securities Regulatory Commission’s opinions must be consulted in advance and approved.
1.2 Conditions for investor investment
At present, the Hong Kong government has legislation on cryptocurrency transactions, and a exchanges approved by the Hong Kong Securities Regulatory Bureau in Hong Kong can legally trade cryptocurrencies.Since ETF is not a direct purchase of virtual currencies, under the current laws of Hong Kong, cryptocurrencies ETFs are regarded as fund supervision. Therefore, as long as the cryptocurrency ETF that is legal on the Hong Kong Securities Regulatory and the Hong Kong Stock Exchange can be purchased through legal channels.Essence
As far as Hong Kong’s current transaction method is concerned, anyone to buy ETFs needs to buy a specific lower -limit fund unit, and different entry thresholds will be different from buying and selling.For example, Samsung Bitcoin Futures Active ETF’s entry threshold is 50 fund units, while 100 fund units of ETF (3066.HK) ETF (3066.HK) in Southern East.At the same time, there are investor restrictions in Hong Kong. According to the requirements of the “Lianhe Communication”, the sales of virtual asset -related products must meet the requirements of relevant jurisdictions, that is, the spot of virtual asset spot ETF is prohibited from selling to mainland investors.The related products of virtual assets are not directly or indirectly sold, sold, sold, or sold for their interests to the legal person or natural person in Mainland China.A legal person or natural person in Mainland China shall not directly or indirectly purchase a Bitcoin ETF without obtaining all the necessary government approval in Mainland China in advance.
2. Hong Kong existing futures Bitcoin ETF
Hong Kong HSBC has recently opened the following three ETFs. The three have been approved to be listed on the Hong Kong Stock Exchange: Southern Dongying Bitcoin Futures ETF, Southern Dongying Bitcoin Futures ETF, Samsung Bitcoin Futures ETF.
2.1 Southern Dongying Bitcoin Futures ETF
Southern Dongying Bitcoin Futures ETF is Bitcoin ETF. It is the first Bitcoin futures ETF in Hong Kong.It was launched on December 16, 2022. At present, the minimum entry threshold is 100 fund units.Its asset size ended with 30.8 million USD on February 01, 2024, with a share scale of 13.89 million copies, and the net asset value per unit was US $ 2.2175.Southern Dongying Bitcoin Futures ETF management fee (including trustee fees, custody fees and administrative fees) is 1.99%per year, and the annual recurring expenditure ratio is estimated to be 2.0%.The fund has increased by 131.00%since its establishment, 62.08%in the past year, and 1.03%in the past month.
2.2 Southern Dongying Ethereum Futures ETF
Southern Dongying Ethereum Futures ETF is Ethereum ETF, and the investment tracking object is the Ethereum Futures Contract on the Chicago Commodity Exchange. The issuer is Southern Dongying Asset Management Co., Ltd.The entry threshold is 100 fund units.Its asset size ended with 12.09 million USD on February 01, 2024, with a share scale of 7.24 million, and the net asset value per unit was $ 1.6709.Southern Dongying Ethereum Futures ETF management fee is 1.99%per year, and the annual recurring expenditure ratio is estimated to be 2.0%.The fund has increased 71.07%since its launch, 80.16%in the past year, and 11.29%in the past month.
2.3 Samsung Bitcoin Futures ETF
Samsung Bitcoin Futures ETF is Bitcoin ETF. The investment tracking object is the Bitcoin futures contract on the Chicago Commodity Exchange.The field threshold is 50 fund units.Its asset size ended February 01, 2024, US $ 10.14 million, with a share scale of 4.75 million copies, and the net asset value per unit of assets was 2.12 US dollars.Southern Dongying Bitcoin Futures ETF management fee is 0.89%per year, and the annual regular expenditure ratio is estimated to be 2.0%.The fund has increased by 96.70%since its release.
3. Taxation of Hong Kong and Singapore residents invest in Bitcoin ETF
The taxation of Bitcoin ETFs in the lower level is roughly the same as other ETFs, involving capital benefits, income tax, pre -tax taxes. Specific taxation is related to factors such as the place of registration, the place where investors live, and the jurisdiction of the investment target.In the sale and redemption of ETFs, the sale is a capital benefit incident, and the redemption is not a taxable incident, no taxes are required; at the same time, investing in Bitcoin ETF dividends in other countries or regions will involve pre -tax taxes.
3.1 Taxation of Hong Kong residents investment futures Bitcoin ETF
Hong Kong takes the basis for levying taxes for its territory, and only levies taxes and income from Hong Kong.At the same time, Hong Kong has not levied taxes on the capital of the company and individuals. However, if the period of holding the shareholding is short, the capital of selling equity will be considered a transaction nature, thereby levying profitable taxes.Therefore, when Hong Kong residents obtained the spread income obtained by selling Bitcoin ETFs, they generally do not need to be levied on profit tax. At the same time, the Bitcoin ETF dividends obtained by Hong Kong residents in Hong Kong generally do not need to pay taxes.
Hong Kong companies were levied profitable taxes to the spread income obtained by the sale of Bitcoin ETFs.Investor corporations’ earnings tax rates were 8.25%of the 2 million Hong Kong dollars, and the subsequent taxable profit was 16.5%.As for people outside the wholly -owned or partnership business, the interest tax rates at the two levels are correspondingly 7.5% and 15%.At the same time, corporate investors generally do not need to pay taxes when investing in Bitcoin ETF.
3.2 Taxation of Singapore Residents Investment Futures Bitcoin ETF
Singapore and Hong Kong do not levy their capital gains from companies and individuals.However, due to anti -tax evasion considerations, if the term holding period is short, the capital of selling equity will be regarded as tax levy, and the right to sell shares with more than 20% of the shares and the shareholding period exceeds 24 months may not be taxed.At the same time, the dividends paid by Hong Kong companies to non -residents have no need to pay pre -tax taxes. Therefore, the dividends and dividends obtained by Singapore residents or enterprises to invest in Hong Kong Bitcoin ETF do not need to deduct pre -taxation.
At the level of investor, Singapore also implements the principle of territorial sources, and only taxes or income from Singapore or from Singapore.However, the Singapore income tax law stipulates that if the income generated outside the Singapore is remitted, transmitted, or brought into Singapore, it is also regarded as “stems from Singapore”.
Individual investors remit the income of investing in the Hong Kong Bitcoin ETF into Singapore, and generally pay personal income tax for the income.Singapore’s personal income tax in 2024 ranges from 0% to 24%, depending on personal taxable income.
Singapore residents have tax exemptions for the dividend income of overseas sources. If they are satisfied: (1) When receiving the income from overseas in Singapore, the highest corporate tax rate (title tax rate) of the overseas country with the income is at least 15%; (2) The income has been taxed overseas; (3) The authorities believe that tax exemption will be beneficial to the resident company.
4. Spot Bitcoin ETF dynamics
In 2022, Hong Kong approved the futures cryptocurrency ETF. Currently, there are three listed products of Southern Dongying Bitcoin Futures, Southern Dongying Ethereum Futures and Samsung Bitcoin Futures.$ 100 million.
In December 2023, the Hong Kong Securities Regulatory Commission and the Hong Kong Financial Administration issued a letter, stating that they were ready to accept the application for the virtual asset spot ETF.This means that Hong Kong is becoming the first market in Asia to allow virtual asset Spot ETFs to list.
On January 26, 2024, Castrol Fund Hong Kong Corporation has submitted a Bitcoin ETF application to the Hong Kong Securities Regulatory Commission, becoming the first institution in Hong Kong to submit Bitcoin spot ETF applications.According to media reports, the Hong Kong Securities Regulatory Commission hopes to speed up the approval of the first Hong Kong Bitcoin spot ETF. After the Spring Festival, the first Hong Kong spot Bitcoin ETF will be listed on the Hong Kong Stock Exchange.The Hong Kong Securities Regulatory Commission may follow the United States, that is, a one -time application for several applications.As of now, no other institution has submitted applications except the Castrol Fund. Although it has been communicating with the Hong Kong Securities Regulatory Commission many times, including Southern Dongying and other institutions, it has not been submitted.
With the development of Bitcoin compliance and the continuous improvement of market maturity, the launch of the Bitcoin spot ETF has achieved a close connection between the traditional financial market and the virtual asset market, marking the opening of the structured financial market to the virtual asset field.Bitcoin standardizes financial products in the form of spot ETF.Bitcoin spot ETF provides more convenient and standardized investment methods for investors, while improving the effective operation of the market and more effective risk management and investor protection.
