CF Benchmarks, a division of the renowned cryptocurrency exchange Kraken, is making significant strides in the global cryptocurrency market. This year, the firm has seen a substantial rise in the value and volume of spot Bitcoin exchange-traded funds (ETFs) it manages.
Surging Market Share
According to a recent Bloomberg report, CF Benchmarks is now responsible for about $24 billion worth of crypto ETFs. This figure represents nearly half of the overall crypto benchmarking market. The increase in assets under management is indicative of the growing acceptance and integration of cryptocurrency in traditional financial markets.
Expansion Plans
In a recent interview, CF Benchmarks CEO Sui Chung highlighted the firm’s ambitious expansion plans. “We are looking at bringing crypto ETFs to new markets such as Israel and South Korea, with South Korea already showing a high degree of crypto adoption,” Chung explained. He added that ETFs are becoming the preferred investment vehicle in South Korea, particularly for long-term savings.
Surpassing Expectations
Initially, CF Benchmarks projected they would manage $5 billion in assets for U.S. spot Bitcoin ETFs this year. However, the actual demand has far exceeded these expectations, with the firm now managing four times the projected amount. This surge in demand reflects the increasing investor interest in cryptocurrencies as a legitimate asset class.
Outlook in Hong Kong
Despite a lukewarm reception initially, with trading volumes for spot Bitcoin and Ethereum ETFs in Hong Kong not exceeding $13 million, CF Benchmarks remains optimistic about the potential in the region. Chung anticipates that the firm will manage approximately $1 billion in assets for Hong Kong products by the end of 2024. This follows Hong Kong’s recent approval of spot Bitcoin and Ethereum ETFs, marking a significant development in the region’s cryptocurrency landscape.
Regulatory Landscape
While Hong Kong has taken steps forward, the U.S. Securities and Exchange Commission (SEC) has been more cautious, especially regarding spot Ethereum ETFs. Approvals for these may be delayed until later in 2024 or beyond, reflecting the regulatory uncertainties still surrounding cryptocurrencies.
A Growing Influence
Founded in 2017 and acquired by Kraken in 2019, CF Benchmarks has quickly risen to a position of influence within the cryptocurrency market. With its significant market share and plans for further expansion, CF Benchmarks is poised to play a pivotal role in shaping the future of crypto ETFs globally.
