Crypto Firms Respond to Hong Kong’s Call for Web3 Leadership

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Hong Kong is accelerating towards its goal of becoming a global crypto hub, according to the regional secretary for financial services and treasury.

In a speech Monday at the Aspen Digital Web3 Investment Summit in the East Asian business hub, Christopher Hui said the city has attracted interest from more than 80 companies wanting to set up shop in Hong Kong.

These include crypto exchanges, blockchain infrastructure companies, blockchain network security companies, virtual currency wallets, and payment companies.

Hong Kong is well positioned to be a leading hub for Web3 in Asia and beyond, and we attach great importance to virtual assets and Web3, Hui said.

Hong Kong has been talking for some time now about becoming a hotspot for digital asset innovation. Its economy and reputation as a fintech hub took a beating after Covid-19 shutdowns and earlier regulatory clampdowns spooked many crypto startups.

One of the most notable examples is the failed crypto exchange FTX, which left for the Bahamas while accusing Hong Kong of confusing the regulatory framework for the move. The exchange was once one of the biggest brands in crypto, but went bankrupt last year due to alleged mismanagement.

Hong Kong has since opened consultations and dropped new rules to allow retail investors access to digital assets.

Nikkei Asia announced today that a number of Chinese crypto firms are eyeing Hong Kong. These include Chinese securities firms and banks that want to allow their customers to trade Bitcoin and Ethereum on licensed exchanges, the newspaper reported.

Last month, Hong Kong’s Securities and Futures Commission (SFC) proposed that the city allow all types of investors, including retail investors, to access trading services provided by licensed VAs. [virtual asset] trading platform operators.

The Mainland Chinese government cracked down on crypto in 2021, when it banned Bitcoin mining.

Hui said in his speech that Web3, the next evolution of the internet, built on blockchain, has the potential to enable more decentralized, efficient and inclusive platforms that benefit users and creators.

It will also create new opportunities for innovation, entrepreneurship and social impact, he added.

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