Hong Kong To Begin Regulating Crypto In June 2023, 80 Firms Ready To Join

The Secretary for Financial Services and the Treasury in Hong Kong, Christian Hui, was among the speakers at the Aspen Digital Web 3 Investment Summit on March 20, 2023.

During his speech mostly focused on building the position of China’s Special Administrative Region as a renowned leader in the Web3 revolution, he revealed that since October 2022, over 80 foreign and Mainland China crypto firms had already expressed interest in establishing a branch in Hong Kong and getting operating licenses.

Hong Kong Attracts Crypto Firms

In October 2022, Hong Kong published a statement on the crypto market regulation, which means that it wants to apply similar laws to crypto exchanges as it does to traditional finance firms. Between then and the end of February 2023, a huge number of domestic and international companies expressed their interest in having a significant presence in Hong Kong.

23 of the 80 mentioned firms are already working to build their local presence, including crypto exchanges, blockchain network firms, or crypto network security providers. Hui said during the conference:

“As of end-February 2023, Invest Hong Kong has received expressions of interest from over 80 virtual asset-related Mainland and foreign companies in establishing their presence in Hong Kong. These companies included 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.”

The region is now preparing to launch VA regulations in June 2023.

Christopher Hui, Secretary for Financial Services and the Treasury Bureau, delivers the opening keynote and reinforces HK government’s vision to develop the virtual asset sector in Hong Kong.
He mentions Web 3 presents a paradigm shift to the internet era. pic.twitter.com/9MGkWOCj0O

— Everest Ventures Group (EVG) (@EVG_Ventures) March 20, 2023

Hong Kong To Regulate Cryptos From June 2023

The Treasury and Secretary for Financial Services acknowledged that regulations planned since 2022 to set up a licensing regime for the virtual asset (VA) service providers must come into effect in June 2023, within the coming three months.

Hui added:

“Through the establishment of a comprehensive and clear regulatory system, we are expecting more quality VA enterprises to set up businesses in Hong Kong or to seek development opportunities in Hong Kong.”

Hui also reiterated that the Hong Kong Monetary Authority (HKMA) is now working on stablecoin regulations, which are now expected to come into effect in 2024. Apart from the work being done by the HKMA, Hong Kong also wants to implement the ability to offer crypto exchange-traded funds (ETFs) to retail investors.

Hong Kong has now earmarked $50 million in its latest budget to create the web3 ecosystem and to enhance its presence in the virtual assets space by organizing conferences and attracting firms from the industry.

Hui concluded his speech:

“While the Government will strive to cultivate a Web3-friendly environment for the industry to thrive, we also count on all of you to make the best use of your expertise and develop in Hong Kong.”