Crypto shouldn't be dismissed as an unsafe investment option

Digital tokens could yet emerge from a horrible year as safer bets

- ANDY MUKHERJEE

In crypto annals, 2022 will go down as the year when this industry nearly died. But then December saw the birth of a pair of exchange-traded funds in Hong Kong, offering new hope. Asia's first futures ETFs for Bitcoin and Ether join a growing list of initiatives that could ameliorate the crisis of legitimacy facing virtual assets. A big dampener is confusion over safe custody of crypto holdings. Sam Bankman-Fried's FTX, the most spectacular of last year's crypto debacles, has brought hapless customers of the failed exchange in front of a US bankruptcy judge who'll determine if they're entitled to money ahead of other creditors. But FTX is not the only test for crypto custody. Last month, a US bankruptcy judge ordered the insolvent Celsius Network to return roughly $50 million that never earned any interest. But the fate of billions of dollars of user funds stuck in interest-bearing accounts is still in question: Does it belong to the debtor's estate or to customers? Uncertainty should ease as cryptos move to normal bourses as regular securities, like stocks and bonds. That will bring customer assets under standard safeguards. For instance, the new CSOP Bitcoin Futures ETF will entrust custody of customer funds to HSBC's licensed Hong Kong trust firm that undergoes [checks].