Hong Kong Legislative Council Member Kenneth Fok Discusses the Development Prospects of Virtual Assets

Recently, Hong Kong has undergone a significant shift in its attitude towards the Web3 field, demonstrating a determination to promote the virtual industry. Kwok Ka-ki, a member of the Legislative Council of Hong Kong representing the technology and innovation sector, has been paying close attention to virtual currency projects and actively advocating for Web3-friendly policies in Hong Kong. He believes that although virtual currency was initially just a niche market, its development momentum has begun to manifest with advancements in technology and an increase in applications.

Qiu Dagen compares the current Web3 trend to the stage of internet development in 2003. He pointed out that, in addition to virtual currencies, Web3 has made breakthroughs in the financial market, personal data, and new directions for the internet.

Comparison of Hong Kong Policies and Singapore

Although some have questioned Hong Kong's determination to become a crypto-friendly city, Qiu Dageng believes that Hong Kong is more similar to Singapore in terms of crypto policies. He stated: "Hong Kong and Singapore are only one or two years apart in their timelines for supporting cryptocurrencies. Overall, Singapore's development is slightly faster, but there is not much difference in policy direction."

Qiu Dagen explained that Singapore has advantages in crypto payments, as institutions can engage in virtual asset trading after completing KYC, but strict regulation is applied to ordinary citizens' virtual asset trading. In contrast, Hong Kong has basically resolved issues regarding bank account openings and is working to narrow the gap with Singapore.

The Development of Hong Kong Dollar Stablecoins

Qiu Dagen revealed that the regulatory framework for stablecoins in Hong Kong may be launched in June next year. He proposed the issuance of a Hong Kong dollar stablecoin to promote the development of virtual assets in Hong Kong. Qiu Dagen believes that the Hong Kong dollar stablecoin has unique advantages: firstly, the issuance of the Hong Kong dollar is supported by USD reserves; secondly, Hong Kong has its own foreign exchange reserves, which can support the Hong Kong dollar during times of USD instability.

He suggested that Hong Kong establish a stablecoin sandbox environment to accelerate the development of the Hong Kong dollar stablecoin. Qiu Dagen emphasized that whether it is the issuance of Hong Kong dollar, US dollar, or Renminbi stablecoins, as long as they are issued in Hong Kong, they must comply with Hong Kong's regulatory requirements.

Regulatory Recommendations After the JPEX Incident

The recent JPEX fraud incident has raised concerns about cryptocurrency regulation in Hong Kong. Qiu Dagen advised users to only trust licensed exchanges and urged the Hong Kong Securities and Futures Commission to expedite the licensing review process. He stated: "Some exchanges may obviously not meet the requirements, but the Commission may still allow these exchanges to supplement their information multiple times, which greatly prolongs the review time."

Qiu Dagen believes that this incident is also an opportunity for investor education. He emphasized that what Hong Kong encourages is not asset speculation, but the development of digital assets and the innovation of financial products.

Despite facing numerous challenges such as policy uncertainty and risks associated with trading platforms, Qiu Dagen remains optimistic about Hong Kong's development prospects in the digital asset space. He believes that with a solid foundation and ample opportunities, Hong Kong has the capability to take a leading position in this emerging field.