Huaxia's Digital Fund Connects Conventional and Decentralized Finance in Its Hong Kong Launch

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Huaxia's Digital Fund Connects Conventional and Decentralized Finance in Its Hong Kong Launch

Bitget-RWA2025/11/26 11:42

By:Bitget-RWA

- Huaxia's digital fund becomes Hong Kong's first digital-asset focused ETF, launching Nov 28, 2025. - The fund invests in non-China blockchain firms to mitigate regulatory risks, mirroring C1 Fund's diversified strategy. - Hong Kong's updated DeFi regulations enable institutional adoption, attracting global platforms like Miracle Exchange. - Market optimism balances with risks: cybersecurity threats and interest rates could pressure growth valuations. - The listing bridges traditional finance and DeFi, po

The Huaxia Hong Kong Dollar Digital Currency Fund is on track to become the first fund centered on digital assets to be listed on the Hong Kong Stock Exchange, with its official launch planned for November 28, 2025. This milestone highlights the increasing interest from institutional investors in digital currencies and blockchain technology, as financial markets worldwide adjust to shifting regulatory and technological conditions. The fund adopts a structure similar to other digital asset investment vehicles, aiming to benefit from the growing appetite for decentralized finance (DeFi) and tokenization solutions.

The investment strategy, as seen in comparable funds, focuses on building a diversified selection of top digital asset infrastructure firms. For example, the

C1 Fund

Inc.,

which recently included Alchemy in its holdings

, seeks to invest in 30 leading companies in the digital asset sector, deliberately excluding those headquartered in China, Hong Kong, or Macao. This approach is consistent with Huaxia’s emphasis on firms outside of China, reflecting a prudent response to regulatory unpredictability in the region. By omitting Chinese companies, the fund mirrors a broader institutional trend to reduce exposure to regulatory risks, especially in markets where digital currency rules are still evolving.

The fund’s listing comes at a time of significant progress in blockchain infrastructure. Paxos’s recent purchase of Fordefi,

a New York-based crypto wallet provider for institutions

, is a clear example of the sector’s rapid development. By incorporating Fordefi’s multi-party computation (MPC) wallet technology, Paxos intends to strengthen its stablecoin and asset tokenization services, giving institutional clients a comprehensive platform for on-chain activities. These advancements highlight the growing sophistication of blockchain infrastructure, an area where the Huaxia fund aims to capitalize.

Hong Kong’s regulatory framework has

become a key driver

for the adoption of digital assets. The city’s recent updates to its financial regulations, which now cover DeFi and Web3 initiatives, have established a system that encourages innovation while safeguarding investors. This regulatory certainty has drawn international firms such as Miracle Exchange,

which has introduced the world’s first “on-chain compensation closed-loop system”

, serving affluent clients in 180 countries. By listing in Hong Kong, the Huaxia fund taps into this dynamic environment, acting as a conduit between conventional finance and the decentralized sector.

Industry observers remain cautiously hopeful about the fund’s outlook.

The C1 Fund’s approach

, which prioritizes investments in digital asset infrastructure, has shown durability even during turbulent market periods. Likewise,

the adoption of DeFi protocols by major platforms

—including Coinbase and Kraken—has broadened access to yield-generating opportunities, further validating the industry. Nevertheless, challenges persist, such as cybersecurity vulnerabilities and macroeconomic pressures like increasing interest rates, which may negatively impact the valuations of digital asset firms focused on growth

according to Seeking Alpha

The Huaxia fund’s arrival on the Hong Kong exchange marks a significant development for digital asset investment in Asia. By providing a regulated means to invest in a carefully selected group of blockchain infrastructure companies, the fund fills a market need while navigating the fast-changing digital asset landscape. As institutional interest in digital assets continues to build, the success of this listing could spur further advancements and regulatory progress, helping to establish Hong Kong as a leading center for digital finance.

Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.

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