Hong Kong-based crypto powerhouse, HashKey Group‘s investment wing, HashKey Capital, has unfolded an interesting strategy for its newly initiated fund. To much surprise, the fund plans to dedicate less than half of its portfolio into the two behemoths of the crypto market, Bitcoin and Ethereum. This revelation by Jupiter Zheng, the fund’s portfolio manager, seems to indicate an increased focus on alternate cryptocurrencies. With an ambitious target set to raise $100 million in just one year, they’ve already made inroads securing potential high-net-worth clients and investment firms.
While part of the fund will inevitably be tied in liquid assets, they are also opening channels with offshore Chinese financial institutions. The motivation behind this diversified strategy emanates from the weaker performance in the Hong Kong stock market, propelling investors to look for alternatives. Their approach plays into the increasing demand from professional investors for above-market returns in cryptocurrency.
One can’t avoid being intrigued by the assertion of cryptocurrencies reaching rock-bottom rates as the overall liquidity in the market improves. This belief is largely backed by a combination of stabilizing US interest rates and larger US asset managers making moves towards spot Bitcoin ETFs.
Just last year, HashKey secured a ‘Type 9 asset management license’ cleared by Hong Kong’s Securities and Futures Commission, which seems to be the ground upon which their latest offering rests. In fact, the company wrapped up a $500 million investment round earlier this year to fuel the adoption of blockchain and crypto technologies.
Hong Kong appears to be a growing hub for crypto-friendly regulations, thus attracting a myriad of digital asset firms. With its new crypto licensing laws, the city-state permits retail investors to trade specific ‘large-cap tokens’. However, these ambitious moves come with the preconditioned safeguards such as knowledge testing, risk profiling, and establishing reasonable exposure limits. The proof lies in the high turnout of around 100 crypto-related conferences hosted in Hong Kong, significantly sparked by the release of their policy statement on virtual assets.
Contrastingly, the US has been tightening the reins around the crypto industry, especially following the aftermath of high-profile crypto companies like FTX. While it presents a plausible regulatory framework, it also sparks the musing that strict regulations could potentially suppress innovation in the digital asset space.
Source: Cryptonews
