Hong Kong Continues To Welcome Digital Assets Despite FTX Fall

Key Insights

• Hong Kong renews its effort to welcome virtual assets 
• It released a report detailing the plans and visions for the innovative technology to work
• Paul Chan said the appropriate regulations and compliance would help avoid incidents like the FTX crash

Hong Kong seems unperturbed by the FTX incident. Unfortunately, the incident has seen the total market value of all digital currencies drop by about $150 million. 

At a time when investors, holders, and industry players are bearish on all digital assets— Report shows that Hong Kong remains bullish in the cryptocurrency ecosystem after the FTX debacle. 

Amidst the crypto winter and some incidents that have dampened investors’ confidence in crypto, Hong Kong released a blog post. 

Amidst The FTX Crash, Hong Kong Releases Virtual Asset Report 

On the 13th of November, Hong Kong’s Financial Secretary, Paul Chan, released a blog post. The timing of the blog post comes days after FTX filed for bankruptcy and fell victim to a massive heist. 

The SAR issued the report titled “Policy Declaration on the Development of Virtual Assets in Hong Kong.”

According to Paul Chan, The country is open to receiving Virtual asset exchange-traded funds (ETFs). Similarly, he said the Securities and Futures Trading Commission would launch a public consultation on protection requirements for retail investors. 

Part of the blog post reads that Hong Kong believes in the potential of blockchain technology. The Government highlights the potential benefits distributed ledgers and NFTs could bring to the financial industry. 

Furthermore, the report clarifies the vision and policy of the country to develop the virtual asset industry. The development will also cover related innovative technologies, applications, and its ecosystem. 

The visions and policies in the report show that Hong Kong has created favorable development conditions for the industry. Similarly, there are several pilot programs to test and improve the level and applicability of related technologies.

Paul Chan said, “this policy declaration shows our determination and commitment to exploring financial innovation together with the industry.” It also states our position on the virtual assets industry— “while actively embracing innovation, there must be regulatory support that adapts and keeps pace with the times.” 

In this tweet, Paul Chan says industry regulation in  is more attractive to investors in the wake of FTX’s collapse.

Hong Kong’s top finance official, Financial Secretary Paul Chan Mo-po, has reiterated the city’s commitment to becoming a virtual asset hub, saying in a blog post that industry regulation is even more attractive to investors in the wake of FTX’s collapse.https://t.co/NzKnarbcdq

— 💥Beijing to Britain💥 (@BeijingToBrit) November 14, 2022

Furthermore, he said that the declaration had been recognized and supported by the virtual asset industry. He added that “We have received many positive responses. Many related companies are also actively considering expanding their operations in Hong Kong.” 

Conclusion 

The Government of the Hong Kong Special Administrative Region released its report through a blog post. While announcing the report’s details, the Financial Secretary, Paul Chan, highlighted the industry’s potential. 

Furthermore, he added that there are several pilot plans in the report. Appropriate regulatory and compliance requirements alongside the pilot plans will help avoid incidents like the FTX crash. 

He, therefore, called on “friends in the innovative technology ecosystem” to work with Hong Kong.