Hong Kong will continue pushing ahead with the development of the Web 3.0 industry as it aims to become a regional hub for the nascent industry despite the series of collapses of crypto exchanges, said Paul Chan, the city’s financial secretary, on Monday.

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Fast facts

  • Chan said at a Web3 event in Hong Kong that in the past two months, many top technology firms and startups have contacted the government to discuss setting up international headquarters or expanding their businesses in the city, but he did not give any names.
  • “We have recently completed the legislative work for licensing virtual asset service providers and the new measure will come into effect in June,” Chan said, adding that under the new regime, the requirements for exchanges to combat money laundering and enforce investor protection will come in line with the standards for traditional financial institutions.
  • Hong Kong is also hosting a number of pilot projects, including those that examine the cross-border use of the e-HKD, the city’s central bank digital currency, and the tokenization of government-issued green bonds, Chan added.
  • Chan’s statement came after the Legislative Council of Hong Kong last month passed an amendment to the bill that includes a licensing regime for virtual asset service providers, which will come into effect on June 1.
  • Also last month, two exchange-traded funds tracking cryptocurrency futures debuted on the Hong Kong Stock Exchange.
  • After China banned crypto transactions on the Chinese mainland in September 2021, Hong Kong in October 2022 released a series of policy documents about crypto and blockchain, announcing its attempts to reposition the city as a regional crypto industry hub.

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