China Plans to Launch its First Blockchain ETF


China has just received an application for listing an Exchange-Traded Fund (ETF). This will track blockchain-related stocks as underlying assets. 

30 December 2019 | AtoZ Markets – The application for the blockchain ETF was accepted by the China Securities Regulatory Commission (CSRC) on Tuesday, December 24. It was filed by Penghua Fund, an asset management company based in China’s Shenzhen city. This comes at a time when the United States is hesitating to approve any Bitcoin ETFs.

First blockchain ETF in China

Penghua intends for the ETF to track and mirror all blockchain firms with public listings in Shenzhen. Moreover, the ETF will also be open to the public without any restrictions, like other available stocks in the market.

news report from the Shanghai Securities News platform states the importance of the ETF. According to the report, the product, as well as similar offerings, will push the Chinese blockchain sector forward.

“The industry believes that with the landing of such fund products in the future, it will provide investors with a new way to share the development dividend of the blockchain industry.”

If approved, it will become China’s first thematic blockchain investment instrument available publically.

Related: How Do Gold ETFs Work?

Shenzhen exchange blockchain 50 index

On the same day of the filing, the Shenzhen Stock Exchange also unveiled a new product. Called the Blockchain 50 Index, the product includes 50 stocks available on the exchange, which are blockchain firms.

The exchange’s announcement explains how the stocks are ranked and adjusted. Currently, the Blockchain 50 Index includes Ping An Bank, Wholeasy, and many others.

China takes the lead in the blockchain industry

Since President Xi Jinping’s public endorsement of blockchain technology, there has been a lot of news from China. While the country is still anti-crypto, more than 500 blockchain projects have been registered by the Cyber Administration of China.

Additionally, China has pretty much made the atmosphere very conducive for blockchain firms, in a bit to lead the sector globally. The kind of support for blockchain, seen from the Chinese government, has not exactly been mirrored in other countries. 

Furthermore, China is also seriously working on its own central bank digital currency (CBDC). Recently, it announced it is ready to test the currency with certain financial and telecoms institutions. Moreover, there are several other countries also considering issuing their own CBDC, but none has moved as fast as China. The Chinese Yuan will most likely be the first fully functional CBDC in the world.

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