2 weeks Ago By The Straits Times
The HKEX Virtual Asset Index Series will provide single, real-time and daily reference prices for Bitcoin and Ether in the Asian time zone. HONG KONG - Hong Kong Exchanges and Clearing Limited (HKEX) has launched a cryptocurrency benchmark to meet the city’s demand for real-time data on the emerging asset class. Hong Kong’s stock exchange operator announced the HKEX Virtual Asset Index Series on Oct 28, which will provide single, real-time and daily reference prices for Bitcoin and Ether in the Asian time zone.
The index will go live on Nov 15. “We’ve seen rising demand for this fast-emerging asset class and with that, a greater need for transparent and reliable benchmarks to enhance understanding and price discovery,” a HKEX spokesperson told The Straits Times. When asked if the index would be expanded to include other virtual assets and digital currencies, the spokesperson noted that “the current focus will be on successfully launching the index series and educating the market”.
Most cryptocurrency benchmarks, such as those from CoinDesk and CoinMarketCap, use Coordinated Universal Time to track the price and performance of cryptocurrencies, which are often also traded at different prices across global exchanges. As at 4.45pm Singapore time on Oct 28, for example, Bitcoin’s price was listed at US$68,268 on CoinMarketCap and US$68,303 on CoinDesk.
The new index will provide a 24-hour volume weighted reference spot price for Bitcoin and Ether, using prices aggregated from top-rated virtual asset exchanges, calculated in real-time and denominated in US dollars. There will also be a reference rate for the two cryptocurrencies, designed for the settlement of financial products and calculated daily at 4pm Hong Kong time. The index series, which will be the first EU Benchmarks Regulation-compliant virtual asset index series developed in Hong Kong, will be administered and calculated by CCData, a UK-registered benchmark administrator and virtual asset data and index provider.
In a statement, HKEX chief executive Bonnie Chan noted that “by offering transparent and reliable real-time benchmarks, we seek to enable investors to make informed investment decisions, which will in turn support the development of the virtual asset ecosystem and reinforce Hong Kong’s role as an international financial centre”. The launch of the index series comes two years after Hong Kong first issued a policy statement on the development of virtual assets in 2022, with the aim to build a vibrant ecosystem for virtual assets in the city. It is also in line with Hong Kong’s push to further support and scale up the virtual asset market in the city.
The Hong Kong Securities and Futures Commission on Oct 28 announced that it expects to award licences to more digital-asset exchanges by the end of 2024. Speaking at the annual Fintech Week event in Hong Kong, Mr Eric Yip, executive director for intermediaries at the commission, said a finalised list of the platforms graduating from a provisional permit to fully licensed will be published by year-end. “The applicants and their controllers have by and large taken up our feedback, and they are willing to commit resources to rectify issues and take a long-term view in developing their business in a regulated environment,” Mr Yip said.
The city is moving ahead with the licensing process after approvals for exchange operators were slower than expected, with only three platforms receiving full licences and a further 11 “deemed-to-be-licensed” since 2022, Bloomberg reported. The Securities and Futures Commission had found unsatisfactory practices at some of those firms during inspections carried out since their provisional approval in June, Bloomberg said. Once those exchanges have implemented changes in line with the commission’s feedback, they will be handed licences for restricted operations, Mr Yip said.
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