A Brief Discussion on the Current Status and Future Directions of Hong Kong's Web3 Ecosystem
Written by: Liu Honglin
Recently, Wu said Blockchain conducted an in-depth interview with Mr. Leung Hon-king from the Hong Kong Invest Hong Kong (InvestHK) to discuss the development direction of Hong Kong in the Web3 and cryptocurrency fields. From policy support to market feedback, and from capital flow to the attempts at tokenizing real-world assets (RWA), the interview systematically showcased Hong Kong's layout in this emerging field.
As a lawyer who has long been concerned with the Web3 industry, Lawyer Honglin is often asked, "Can Hong Kong really become a global center for Web3?" The answer to this question is not simple, as it involves not only the policy environment and market attractiveness but also capital flow, regulatory frameworks, talent reserves, and the interaction between Hong Kong and global financial markets. Mr. Leung's interview provided many thought-provoking perspectives, and I would like to combine my professional experience to analyze the key content discussed in the interview and talk about the current status and potential future directions of Hong Kong's Web3 ecosystem.
How Does Hong Kong Support the Web3 Industry?
In the interview, Mr. Leung introduced the main work of InvestHK in the Web3 field. He emphasized that Hong Kong has always been known for its free market and international brand, with its capital liquidity, mature regulatory framework, and close ties to international markets providing a natural advantage for the development of Web3 and cryptocurrencies. From the government's perspective, the primary function of InvestHK is to attract international companies to establish themselves in Hong Kong and assist them in obtaining more resources in the market. Whether from mainland China, the United States, the United Kingdom, or entrepreneurial teams with Chinese backgrounds, they can connect with local banks, investment institutions, and government departments through InvestHK's channels to expedite market integration.
In terms of industry promotion, InvestHK also plays an important role. For example, they actively participate in and support large events such as the Consensus conference and Hong Kong FinTech Week, aiming to build a communication platform for Web3, virtual assets, financial technology, and blockchain companies, attracting more businesses to pay attention to the Hong Kong market. Policy feedback is also an important responsibility for them. Due to InvestHK's close daily contact with businesses, they can quickly understand industry dynamics and needs and relay this information to regulatory authorities, allowing policy formulation to be more aligned with the actual development of the industry.
In addition, InvestHK is also promoting the integration of large industry resources. For instance, the Hong Kong Monetary Authority (HKMA) launched the Project Ensemble, aimed at promoting the tokenization of RWA (real-world assets), attracting numerous banks and technology companies to participate. However, many international companies find it difficult to directly connect with regulatory agencies or investors even after hearing about this project. InvestHK plays a key role in this process, helping companies find suitable connection channels through its market network, enabling them to smoothly participate in Hong Kong's Web3 development process.
Mr. Leung mentioned in the interview that Hong Kong has always supported the development of the Web3 industry and has not experienced drastic policy changes. From the government's perspective, Hong Kong is a free market with free capital flow, thus possessing a natural advantage in developing cross-border, borderless industries. The core characteristics of the Web3 industry are globalization and decentralization, which align closely with Hong Kong's financial ecosystem. Therefore, InvestHK began to pay attention to this industry early on and has continued to provide support.
However, despite Hong Kong's overall supportive attitude towards Web3, it still maintains caution in specific policies. For example, in the area of ICOs (Initial Coin Offerings), Hong Kong has not adopted a completely open policy but has set relatively strict entry thresholds. Currently, licensed exchanges in Hong Kong must undergo rigorous due diligence (DD) before listing new tokens to ensure the legality and feasibility of the projects, and only projects that meet compliance requirements are likely to gain the opportunity to operate in the Hong Kong market. This model reflects the Hong Kong government's pursuit of a balance between market openness and investor protection.
Three Core Directions of Hong Kong's Web3
In the interview, Mr. Leung repeatedly mentioned several core areas of Hong Kong's Web3 development, which not only involve policy directions but also relate to Hong Kong's strategic positioning in the global cryptocurrency market.
Currently, Hong Kong's Web3 development mainly focuses on three key areas: stablecoins and cross-border payments, tokenization of real-world assets (RWA), and digital culture and the Crypto Native industry. These three areas not only align with Hong Kong's traditional financial advantages but also follow the global trends in the digital asset market.
Stablecoins and Cross-Border Payments: A Key Link in Transitioning from Traditional Financial Systems to Web3
Mr. Leung mentioned in the interview that the largest market for stablecoins lies in cross-border payments, especially in the B2B trade sector.
The existing international cross-border payment systems often face issues of long transaction times and high costs, particularly in developing countries and some emerging markets. Some international trade companies may take several days or even a week to settle funds during cross-border transactions, with payment fees in some regions reaching as high as 10%. In contrast to traditional cross-border bank transfers, stablecoin transactions offer advantages such as low costs, high efficiency, and 24/7 availability. The application of stablecoins can significantly shorten transaction times, improve capital turnover efficiency, and reduce exchange costs. Therefore, Hong Kong hopes to leverage its position as a financial center to promote the compliant development of stablecoins, making them an important payment tool in global trade and financial markets.
The two major stablecoins in the market, USDT (Tether) and USDC (Circle), are widely used for cross-border payments, but their compliance has always been a focus of concern for governments worldwide. In contrast, Hong Kong aims to launch compliant stablecoins to provide businesses with a payment tool that meets regulatory requirements while satisfying market demands.
In 2023, the Hong Kong Monetary Authority (HKMA) introduced a regulatory framework for stablecoins and encouraged the establishment of regulated stablecoin issuing institutions in Hong Kong. The Hong Kong government is promoting a pilot program for regulated stablecoins, hoping to enhance the settlement efficiency of financial transactions using blockchain technology.
This strategy has two important market backgrounds: first, there is a rapidly growing demand for stablecoin payments among global foreign trade companies, particularly Chinese cross-border e-commerce businesses and foreign trade companies that require more efficient and low-cost international settlement tools; second, Hong Kong itself is a major financial hub in Asia, and if it can gain an advantage in stablecoin clearing and settlement, it will help enhance its influence in the global cryptocurrency financial market.
From market trends, the role of stablecoins extends far beyond facilitating fund flows on exchanges. They are becoming an important infrastructure for international trade payments, supply chain finance, and even central bank digital currency (CBDC) experiments. The pilot project for stablecoin regulation in Hong Kong is likely to attract more companies to establish stablecoin issuance and settlement businesses here, thereby strengthening Hong Kong's central position in the Web3 financial ecosystem.
Tokenization of Real-World Assets (RWA): A Bridge Between Traditional Finance and Web3
Tokenization of RWA is currently one of the most important Web3 directions in the global financial market, and Hong Kong's layout in this area is particularly crucial. RWA tokenization refers to converting traditional financial assets (such as bonds, stocks, real estate, and funds) into digital assets on the blockchain, enabling them to be traded on decentralized networks and improving liquidity.
Mr. Leung mentioned in the interview that Hong Kong has already made practical cases in RWA tokenization. For example, in 2023, the Hong Kong government launched the world's first tokenized green bond and conducted a second round of pilot testing in 2024. This initiative not only demonstrates Hong Kong's innovative attempts in the global green finance market but also indicates the government's desire to enhance the transparency and liquidity of capital markets through blockchain technology.
The potential market size for RWA tokenization is enormous. According to a white paper jointly released by Boston Consulting Group (BCG), Invesco, and AxoneChain, the global fund tokenization market is expected to reach $610 billion. Currently, several financial centers worldwide are advancing RWA tokenization projects, such as Switzerland, the UAE, and certain states in the United States, while Hong Kong also hopes to take a leading position in this field.
Hong Kong's development in RWA tokenization has several core advantages: first, Hong Kong itself is an important hub for global capital markets, with a large institutional investor base; second, Hong Kong's financial regulatory system is relatively mature, providing stable legal and compliance support; finally, the banking and securities market infrastructure in Hong Kong is highly digitized, providing practical technical support for RWA tokenization.
The implementation of RWA tokenization will bring new investment opportunities to Hong Kong's capital markets. For example, traditional real estate funds, infrastructure investment funds, and private equity funds can improve liquidity and market participation through blockchain tokenization. At the same time, the trading efficiency of tokenized securities far exceeds that of traditional securities markets, which will help enhance Hong Kong's financial market competitiveness. In the future, as the Hong Kong government continues to promote the improvement of relevant regulatory frameworks, RWA tokenization is likely to become one of its core competitive strengths in Web3 development.
Digital Culture and the Crypto Native Industry: Unique Business Opportunities for Web3 in Hong Kong
In addition to stablecoins and RWA tokenization, Hong Kong also has unique advantages in the digital culture and Crypto Native industry (i.e., the native cryptocurrency industry). Mr. Leung mentioned in the interview that Hong Kong is not only an international financial center but also the second-largest art auction market in the world, second only to New York, and has surpassed London since 2020. This means that Hong Kong naturally has the soil to develop the NFT (non-fungible token) and digital art markets.
After experiencing a wave of enthusiasm in 2021, the NFT industry has returned to rationality, but Hong Kong's digital culture industry continues to develop. Many high-net-worth investors and second-generation wealthy individuals are very interested in digital artworks, and Hong Kong's international environment makes it an ideal place for trading digital artworks and developing NFTs. For example, international auction houses like Sotheby's and Christie's have begun accepting NFT artworks for auction, creating more business opportunities for Hong Kong's digital culture industry.
In addition to NFTs, Hong Kong is also a gathering place for Chinese Crypto Native entrepreneurs, especially in the C-end application fields (such as crypto social, Web3 games, on-chain content platforms, etc.). Many Web3 companies in Western markets focus more on infrastructure, while Chinese entrepreneurs have accumulated rich experience in C-end applications during the Web2 era, such as e-commerce, social media, and content platforms. Hong Kong's friendly policy environment, abundant funding, and its status as an international city make it very convenient to connect with overseas markets, prompting many Chinese Web3 entrepreneurs to choose to establish their international headquarters in Hong Kong to explore new opportunities in C-end applications.
In the digital culture and Crypto Native industry, the commercialization opportunities in Hong Kong far exceed NFT trading. For example, some well-known brands have begun to experiment with Metaverse-related projects in Hong Kong, including brand virtual spaces and digital fashion. The influence of Hong Kong's international film and cultural industry also provides great potential for the application of Web3 technology in entertainment fields such as film, music, and gaming.
In the future, Hong Kong may promote more attempts at the compliance of NFTs and digital assets to attract international digital artists, game developers, and content creators into the Hong Kong market. If Hong Kong can establish a clear regulatory framework for the Web3 cultural industry and provide more commercialization channels for content creators, it is likely to become one of the important centers of the global Web3 cultural industry.
Summary by Lawyer Mankun
From a global competitive perspective, Hong Kong's Web3 development model differs from those of financial centers like Singapore, Dubai, and Switzerland. Singapore focuses more on the early entrepreneurial ecosystem of Web3, while Dubai attracts global capital through relaxed regulations. In contrast, Hong Kong's strategy is to deeply integrate Web3 into the traditional financial system and promote industrial upgrades through compliance.
The development of stablecoins in Hong Kong focuses on meeting cross-border payment needs rather than simply expanding the cryptocurrency trading market. The development of RWA tokenization attempts to leverage blockchain technology to enhance asset trading liquidity in the context of the global capital market transformation trend. In the digital cultural industry, Hong Kong hopes to utilize its advantages in the international art market to explore the possibilities of new business models such as NFTs and the Metaverse.
Hong Kong does have "natural advantages" in the Web3 field, but its future will not be one of automatic success; it requires continuous optimization of policy execution, market development, and global competitiveness. Hong Kong's core positioning remains as an international financial center, with Web3 being an important part of financial innovation. Finding a balance between regulation, market demand, and compliance frameworks will determine whether Hong Kong can truly become a global hub for Web3.
From a legal perspective, while the development of Web3 in Hong Kong is full of opportunities, compliance remains the most important cornerstone. For industry participants, understanding regulatory logic and reasonably planning business models will be key to establishing a foothold in the Hong Kong market. For Web3 companies looking to enter Hong Kong, now is a critical window period: the policy environment in Hong Kong is becoming clearer, and market opportunities are gradually emerging. However, companies must still prepare for compliance planning when entering, especially regarding capital flow, regulatory licenses, and business models, to ensure compliance with Hong Kong's financial rules.
免责声明：本文章仅代表作者个人观点，不代表本平台的立场和观点。本文章仅供信息分享，不构成对任何人的任何投资建议。用户与作者之间的任何争议，与本平台无关。如网页中刊载的文章或图片涉及侵权，请提供相关的权利证明和身份证明发送邮件到support@aicoin.com，本平台相关工作人员将会进行核查。
