Hong Kong Legislative Council Member Kenneth Fok on the Development of Virtual Assets: Advancements in Technology and Policy Adjustments Go Hand in Hand

In recent years, Hong Kong has shown a notable shift in its attitude towards the Web3 and virtual asset industry, demonstrating a determination to promote the development of this emerging field. As a member of the Legislative Council of Hong Kong representing the technology and innovation sector and an active advocate for Web3-friendly policies, Kenneth Lau has been closely monitoring relevant projects since the early days of virtual currencies. He believes that although virtual currencies were initially just a niche market, their development momentum has begun to emerge with technological advancements and the continuous expansion of application scenarios.

Qiu Dagen compares the current Web3 trend to the internet development stage in 2003 and holds an optimistic view on the prospects of virtual currency and Web3. He pointed out that, in addition to virtual currency, Web3 shows great potential in financial markets, personal data, and new directions on the internet.

Hong Kong's policies closely follow international standards

Despite Hong Kong's announcement to become a crypto-friendly city, there are still skeptics. In this regard, Qiu Dageng stated that Hong Kong and Singapore have similar crypto policies, but their development directions are slightly different. He believes that while Hong Kong is somewhat slower than Singapore in overall planning, there is not much difference in policy direction. Issues like bank account opening have basically been resolved, and the two places are only one or two years apart in their cryptocurrency support timeline.

After experiencing multiple upheavals in the cryptocurrency industry last year, Singapore seems to have slowed down its development pace in this field, which has also provided more opportunities for Hong Kong to catch up.

The regulatory standards for Hong Kong dollar stablecoins are about to be released

Stablecoins have become an important asset class in the blockchain space. As of September 20, the market capitalization of stablecoins has exceeded $120 billion. Qiu Dagen stated that Hong Kong's stablecoin regulatory framework may be launched in June next year. He suggested setting up a stablecoin sandbox environment to accelerate the development process of the Hong Kong dollar stablecoin.

Qiu Dagen emphasized that whether it is the issuance of Hong Kong dollars, US dollars, or Renminbi stablecoins, as long as they are issued in Hong Kong, they must comply with Hong Kong's regulatory requirements. He predicts that in the future, there may be a situation where multiple stablecoins coexist, and investors will also need to diversify their assets.

Regulatory Reflections After the JPEX Incident

Recently, the fraud incident involving the Hong Kong exchange JPEX has sparked in-depth reflection on crypto regulation. Qiu Dagen advises users to only trust exchanges that have obtained licenses, while also calling on the Hong Kong Securities and Futures Commission to accelerate the license review process. He pointed out that some exchanges may clearly not meet the requirements, but regulatory bodies may still allow them to supplement their information multiple times, which greatly prolongs the review time.

Qiu Dagen believes that the JPEX incident is also a process of investor education. He emphasized that Hong Kong encourages not asset speculation, but the development of digital assets and the innovation of financial products. If Hong Kong does not actively participate, it may fall behind in areas including stablecoins, central bank digital currencies, and virtual currencies.

Despite facing numerous challenges, such as policy uncertainties and risks associated with trading platforms, Qiu Dagen remains optimistic about Hong Kong's development prospects in the field of digital assets. He believes that with a solid foundation and ample opportunities, Hong Kong has the potential to take a leading position in this emerging sector.