Hong Kong Officially Makes A Move Towards Legalizing Crypto

On Monday, October 31, the government of Hong Kong came up with an official policy document that would legalize retail crypto trading in the region. Over the last week, there have been some key developments with Hong Kong aiming to become a key destination for crypto activities in Asia.

The government said that they had started some consultations retail segment “may be given a suitable degree of access”. The city also invited global crypto firms to explore business opportunities.

Interestingly, the officials also noted that they are open to the idea of listing crypto exchange-traded funds (ETFs) under of “sustainable and responsible development” of the region’s crypto sector. Besides, they are also open to assigning property rights to tokenized assets while legalizing smart contracts.

The Hong Kong Monetary Authority will soon release the consultation guidance on the regulatory regime of stablecoins. The Financial Secretary, Mr. Paul Chan, said:

“The policy statement explains in detail our vision and approach, regulatory regimes, thoughts on investors’ exposures, and our pilot projects to embrace the technological benefits and financial innovations brought by VA. Our policy stance on VA is now clearly communicated to the global markets and it serves to demonstrate our commitment and determination to explore financial innovations together with the global VA community.”

Hong Kong – Addressing Risks With Crypto

In another policy paper, Hong Kong also noted that it will be careful about the risks of crypto to retail investors. Furthermore, they will enhance education and ensure proper regulatory measures in this regard.

The government also said that they are exploring several pilot projects to test the technological viability of using digital assets. This includes non-fungible tokens (NFT) issuance, Green bond tokenisation, and e-HKD.

To bring comprehensive and balanced regulations, the government has invited crypto industry players to work with them. Together, they seek to make Hong Kong the global financial center to realize crypto innovation. The Financial Secretary, Mr. Paul Chan, said:

“The policy statement explains in detail our vision and approach, regulatory regimes, thoughts on investors’ exposures, and our pilot projects to embrace the technological benefits and financial innovations brought by VA”.