Chinese regulators are looking to allow Western traders to act as market makers in the country's exchange-traded fund industry, Reuters reported Friday, citing two people with direct knowledge of the matter.

Beijing has been issuing more licenses to help boost domestic market makers, but international market makers have more experience in supplying cash to ETFs with lower costs, Reuters said, citing the sources.

However, the US's 145% tariffs against China could delay the approval of the US-based firms, the report said.

Citadel Securities applied for a Chinese license to set up a securities brokerage back in January. Jane Street is also among those that could benefit once the Chinese market opens up, Reuters said.

The size of China's ETF market is $520 billion, according to Reuters.

(Market Chatter news is derived from conversations with market professionals globally. This information is believed to be from reliable sources but may include rumor and speculation. Accuracy is not guaranteed.)