Hong Kong issues new policy declaration to actively promote digital asset development

Recently, the Hong Kong Special Administrative Region government announced the "Hong Kong Digital Asset Development Policy Declaration 2.0", demonstrating its firm determination to build a globally leading digital asset center. This declaration aims to create a trustworthy market environment that is risk-controllable, innovation-driven, and brings substantial benefits to the real economy and financial markets.

Meanwhile, Singapore has tightened its policies on unlicensed institutions. Industry insiders believe this may weaken Singapore's influence in the Web3 sector. Some analysts point out that Hong Kong is expected to take this opportunity to re-establish its position as a global Web3 hub.

The Hong Kong government has proposed a series of strategic policy directions framed around "LEAP," covering areas such as legal regulatory optimization, tokenized product expansion, application scenario advancement, and talent partnership development. These initiatives aim to build a trustworthy, innovative, and vibrant digital asset ecosystem, thereby consolidating Hong Kong's leading position in the global financial landscape.

In terms of regulation, the government plans to conduct public consultations on the licensing mechanism for digital asset trading and custody service providers. The Securities and Futures Commission will become the main regulatory body, responsible for licensing, registration, and the formulation of standards. The Hong Kong Monetary Authority will oversee the related activities of banks.

The government will also promote the further application of tokenization in Hong Kong. The Financial Secretary and the Monetary Authority will review relevant laws and regulatory frameworks and plan to regularize the issuance of tokenized government bonds. In addition, the government will consider including designated digital assets in the scope of qualified transactions eligible for profits tax exemption.

Regarding stablecoins, the government has stated that it will provide a favorable market environment and necessary regulatory guidance to promote the development and implementation of various application scenarios by licensed stablecoin issuers in Hong Kong. The government also welcomes market participants to propose suggestions on how to experiment with and use licensed stablecoins.

To support industry development, the Cyberport will launch a pilot funding program for blockchain and digital assets, providing funding and support for promising projects. At the same time, the Invest Hong Kong will also assist digital asset service providers in establishing and expanding their businesses in Hong Kong.

Industry experts have given positive feedback on this policy declaration. They believe that it not only showcases Hong Kong's innovative leadership in the digital age but also clarifies regulatory responsibilities, reducing functional overlaps. At the same time, the government's friendly attitude towards digital assets and substantial support measures will help attract more talent and projects, enhancing Hong Kong's position in Asia's digital asset compliance innovation.

The Financial Secretary of Hong Kong, Paul Chan, emphasized that digital assets are an important component of financial technology and have tremendous development potential. He stated that by balancing prudent regulation and encouraging market innovation, Hong Kong will build a more prosperous digital asset ecosystem that integrates with the real economy and social life.

The Secretary for Financial Services and the Treasury, Xu Zhengyu, stated that this policy declaration provides a clear roadmap for businesses and investors, helping them make informed decisions in a robust and thriving digital asset market.

In a media interview, Paul Chan further elaborated on Hong Kong's strategy to promote the development of digital assets. He emphasized that Hong Kong will advance the integration of virtual assets with the real economy through a dual-track approach of licensing management and scenario-based applications. Particularly in terms of stablecoin regulation, Hong Kong requires that their applications must be linked to real-world scenarios such as trade settlement and cross-border payments to prevent speculative trading.

Industry insiders pointed out that Hong Kong's recent policy update has completed a "trinity" of institutional closure, including regulatory certainty, asset transparency, and tax competitiveness. These measures not only support the development of Web3 but also integrate Web3 as part of the financial infrastructure, demonstrating Hong Kong's determination and vision in promoting digital financial innovation.