Hong Kong Business News

The Government today issued its “Policy Statement 2.0 on the Development of Digital Assets in Hong Kong”, reinforcing a commitment to establishing Hong Kong as a global hub for innovation in the digital asset field.

The statement sets out a vision for a trusted and innovative digital asset ecosystem that prioritises risk management and investor protection, while delivering concrete benefits to the real economy and financial markets.

It also introduces the “LEAP” framework, which focuses on four areas: legal and regulatory streamlining; expanding the suite of tokenised products; advancing use cases and cross-sectoral collaboration; and people and partnership development.

In terms of legal and regulatory streamlining, the Government is establishing a comprehensive and unified regulatory framework for digital asset service providers. The Securities & Futures Commission (SFC) will oversee licensing regimes for digital asset-dealing service providers and digital asset custodianship service providers. Meanwhile, the Financial Services & the Treasury Bureau (FSTB) and the Monetary Authority will spearhead a comprehensive legal review to facilitate the tokenisation of real-world assets and financial instruments.

To expand the suite of tokenised products, the Government will regularise the issuance of tokenised Government bonds. It will also promote the tokenisation of a broader range of assets and financial instruments, demonstrating the versatility of tokenisation technology across sectors such as precious metals, non-ferrous metals and renewable energy.

On the advancement of use cases and cross-sectoral collaboration, the implementation of a licensing regime for stablecoin issuers on August 1 will facilitate the development of real-world use cases. The Government is also fostering collaboration among regulators, law enforcement agencies and technology providers to develop digital asset infrastructure.

Regarding people and partnership development, the Government is strengthening talent development through partnerships with industry and academia, and is positioning Hong Kong as a centre of excellence for digital asset knowledge-sharing and international co-operation. It will build a sustainable talent pool through cultivating a new generation of entrepreneurs, researchers and technologists.

Financial Secretary Paul Chan said the policy statement 2.0 sets out the Government’s vision for digital asset development and showcases the practical uses of tokenisation, with a view to boosting the diversification of use cases.

“We strive to build a more flourishing digital asset ecosystem which will integrate the real economy with social life through a prudent regulatory regime and encouragement to market innovation, such that it will bring benefits to both the economy and society while consolidating Hong Kong’s leading position as an international financial centre.”

Secretary for Financial Services & the Treasury Christopher Hui said: “The framework set out in the policy statement 2.0 helps us ‘LEAP’ towards a trusted, sustainable and deeply integrated DA (digital asset) ecosystem embedded within the real economy.

“It also keeps Hong Kong at the forefront of digital transformation, offering a clear roadmap for businesses and investors to thrive in a secure and vibrant digital asset market.”

The FSTB and the SFC will conduct public consultations on the licensing regimes for digital asset-dealing service providers and digital asset custodianship service providers.

Click here for the full policy statement.