Hong Kong is aiming to become a leading hub for Web3 in Asia and beyond, with the government providing a comprehensive support system to enterprises passionate about pioneering and start-ups in this area.
The government has a high-level commitment to developing the sector and is providing a facilitating environment with timely and necessary guardrails to mitigate actual and potential risks in accordance with international standards, in order to promote the sustainable and responsible development of the virtual asset (VA) and Web3 sector in Hong Kong.
The Hong Kong Monetary Authority is working on a regulatory regime for “stablecoins” with an aim to implementing the relevant regulation in 2024. As of end-February 2023, Invest Hong Kong has received expressions of interest from over 80 virtual asset-related companies interested in establishing their presence in Hong Kong, including VA exchanges, blockchain infrastructure companies, blockchain network security companies, virtual currency wallets and payment companies, as well as other projects on building the Web3 ecosystem.
As of end-February 2023, 23 companies from the Mainland, Canada, EU (European Union) countries, Singapore, the UK (United Kingdom) and the US (United States) have indicated to Invest Hong Kong that they planned to establish their presence in Hong Kong.
The Hong Kong Government is also establishing a licensing regime for VA service providers which will commence operation in June 2023. Through the establishment of a comprehensive and clear regulatory system, they are expecting more quality VA enterprises to set up businesses in Hong Kong or to seek development opportunities in Hong Kong.
On market development, the securities rules in Hong Kong have been advanced to allow regulated intermediaries to offer trading of eligible VA Futures ETFs to retail investors, making Hong Kong a pioneer in the Asian market. Three VA Futures ETFs have already been listed and traded on the Hong Kong Stock Exchange.
Furthermore, the Hong Kong government is collaborating with the Mainland on testing the use of digital Renminbi for making cross-boundary payments in Hong Kong, and working with a number of central banks on a multiple central bank digital currency bridge project to expedite cross-border payments. The Hong Kong government is also looking into the issues pertinent to possible issuance of e-Hong Kong dollar.
The Cyberport in Hong Kong has housed a community of start-ups and technology companies, including a number of Web3-related technology companies in areas including financial technology, smart living, and digital entertainment. In light of the development of Web3, Cyberport established the Web3 Hub@Cyberport early this year.
In addition, the Hong Kong government has proposed a fintech internship scheme for post-secondary students in the 2023 Budget. Subsidies will be provided to participating students in Hong Kong and the GBA (Guangdong-Hong Kong-Macao Greater Bay Area). The scheme facilitates eligible students to acquire practical work experience in fintech enterprises in Hong Kong or the wider GBA, and helps them develop an early interest in pursuing a career in fintech after graduation.
The Financial Secretary announced in this year’s Budget that the government will set up a Task Force on VA Development to examine the market situation, development opportunities, regulation needs and ecosystem of the VA sector in Hong Kong, aiming to formulate proposals on how to promote the sustainable and responsible development of the sector. Also announced in this year’s Budget, $50 million will be allocated to expedite the Web3 ecosystem development.
Read more:
- SVB’s Collapse Highlights Limits Of Easy Money Policies, Warns Telegraph Report
- 3 Years Ago, Bitcoin’s Price Crashed 50% In One Day: Will This History Repeat Itself?
- Binance Utilizes Remaining $1B Industry Recovery Initiative Fund To Buy BTC, BNB, And ETH Amidst US Bank Crisis