The Government of Hong Kong issues a policy statement on the development of Virtual Assets (VA) setting out a policy stance and approach towards “developing a vibrant sector and ecosystem” for VA in Hong Kong.
According to the statement, “the vision presented in the policy statement will be achieved by facilitating policies, comprehensive and balanced regulations, risk-based guardrails, as well as our pilot projects.”
In order for Virtual Assets innovations to flourish in Hong Kong in a sustainable way, the government will put in place the time and required guardrails to manage actual and potential hazards in accordance with international standards.
As they intensify the planning for a new licensing scheme for VA service providers, they are prepared to engage with international Virtual Assets exchanges and invite them to Hong Kong for potential new business relationships.
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Hong Kong will be open to the prospect of establishing Exchange Traded Funds (ETFs) on VA, and the Securities and Futures Commission will be holding a public consultation on how retail investors may be granted a reasonable degree of access to VA.
The Government is open to future reviews of the legality of smart contracts and property rights for tokenized assets to support their development in Hong Kong,
“Consultation outcome and next steps will be announced in due course by the Hong Kong Monetary Authority on the regulatory regime for stablecoins,” the statement reads.
To evaluate the technological advantages offered by Virtual Assets and their potential future applications in the financial markets, the government and regulators are looking into a variety of pilot projects.
These initiatives include issuing NFTs for the Hong Kong Fintech Week 2022, the tokenization of Green bonds, and e-HKD.
The Secretary for Financial Services and the Treasury, Christopher Hui, noted, “We recognize the potential of DLT and Web 3.0 to become the future of finance and commerce, and under proper regulation, they are expected to enhance efficiency and transparency.”
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The Financial Secretary, Paul Chan, stated, “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.”
