Hang Seng Gold ETF, a physical gold exchange-traded fund (ETF) launched in Hong Kong, has made it possible to issue tokens on Ethereum that represent units of the ETF backed by physical gold.
The product began trading on the Hong Kong Stock Exchange on January 28th. It rose 9% on the first day of trading.
The ETF’s closing price for the day was HK$17.44 ($2.43) per unit, compared to its previous closing price of HK$16.00 ($2.05).
During the session, 7.54 million units were traded, with a trading value equivalent to USD 16.9 million in USD.
This product is managed by Hang Seng Investment Management Limited and aims to replicate the gold price performance set by the London Bullion Market Association (LBMA Gold Price AM), before fees and expenses. For this purpose, The Fund acquires and holds physical gold bars as collateral.
Hang Seng Investment Management is the asset management arm of Hang Seng Bank Group, one of Hong Kong’s leading financial institutions. Although the Group maintains historical links with the development of the Hang Seng Index, the Manager operates independently of the management of the Index and focuses on the creation and management of regulated funds for institutional and retail investors.
In addition to traditional stock market operations, The fund incorporates a scheme of tokenized units Those that are not directly listed on the stock market.
These digital representations are issued through a process managed by HSBC Bank, which acts as the tokenization agent. In this scheme, the tokens do not directly represent gold, but instead represent units in an ETF, which is still backed by physical gold held by the fund.
Investors can purchase or redeem these tokenized units through eligible dealers based on the regulatory framework in force in Hong Kong. In the product documentation, in the future, In addition to Ethereum, other public networks deemed secure by authorities can also be incorporated.
The choice of Ethereum is supported by its importance in the tokenization of real world assets (RWA), a segment that includes financial instruments. merchandise Funds backed by physical assets, as reported by CriptoNoticias.
The ecosystem created by Vitalik Buterin is most commonly used in the RWA industry. the current, The value of tokenized assets deployed on Ethereum exceeds $24.02 billionreflected in the following graph.
Furthermore, the launch of this ETF comes against the backdrop of increasing global demand for gold. Precious metals are currently trading at historic levels.
As reported by CriptoNoticias, gold’s rally comes while investors’ attention is focused on multiple factors. bring uncertainty to financial markets. The US dollar depreciated against major currencies. This is indicated by DXY, an index that compares its value with the euro (EUR), Japanese yen (JPY), pound sterling (GBP), Canadian dollar (CAD), Swedish crown (SEK), and Swiss franc (CHF).
