Two crypto funds are being created in Hong Kong

The Chinese government is more positive than one would expect on the cryptocurrency market since a major state corporation is opening new cryptocurrency funds.

The local tech-focused news agency 36Kr reported on April 3 that CPIC Investment Management, a subsidiary of China Pacific Insurance (CPI), is launching two crypto funds in partnership with the investment firm Waterdrip Capital.

CPI is the second-largest property insurance company in mainland China, behind the People’s Insurance Company of China, and is owned by the central government of China, the Shanghai municipal government, and China Securities Finance.

The new crypto funds reportedly include the Pacific Waterdrip Digital Asset Fund I, a venture capital fund that will invest in early-stage blockchain initiatives. According to reports, the second fund, Pacific Waterdrip Digital Asset Fund II, would handle proof-of-stake digital assets.

The new crypto funds will target institutional and affluent private investors, according to the report.

Waterdrip is a worldwide investment firm that backs blockchain-related initiatives and cryptocurrency entrepreneurs.

Waterdrip was founded in 2017 and is known for supporting the Chinese crypto mining industry and investing in initiatives such as the decentralized Web3 network Peaq based on Polkadot.

The company confirmed the news via Twitter on Monday, stating that the launch of the two joint crypto funds is related to the Hong Kong government’s implementation of incentive policies for virtual assets.

The news comes as the Hong Kong government becomes more committed to developing local cryptocurrency infrastructure, distinguishing its approach to crypto regulation from China’s crypto prohibition, which will be implemented in 2021.

Late in March, internet reports revealed that Chinese state-owned banks were becoming more interested in some Hong Kong crypto companies.