- Acting Financial Secretary Chen Haoxian clarifies minor cryptocurrency investments within diversified asset classes by external fund managers.
- 2022 policy declaration by Hong Kong aims to regulate virtual assets with strict anti-money laundering measures.
- Proposals for regulating fiat stablecoins and virtual asset service providers to be discussed in Legislative Council this year.
Hong Kong’s financial authorities are contemplating the integration of digital assets into their broader economic strategy.
As traditional financial institutions increasingly back digital assets, local policymakers are examining the potential roles these could play within the territory’s fiscal management frameworks.
Acting Financial Secretary Chen Haoxian addressed concerns regarding the potential inclusion of cryptocurrencies in Hong Kong’s financial reserves. In his detailed response, he noted that the territory’s foreign exchange fund primarily targets traditional, diversified asset classes to diversify risks and enhance long-term financial returns.
While explicitly stating that cryptocurrencies do not currently align with the primary investment targets of the fund, Chen acknowledged that minor, incidental cryptocurrency investments have occurred through external fund managers.
In October 2022, Hong Kong’s government made a significant policy declaration aimed at fostering the development of virtual assets while ensuring robust regulation.
Adhering to the principle of “same business, same risk, same rules” the initiative seeks to provide a clear and consistent regulatory framework for cryptocurrency operations. This framework includes stringent measures against money laundering and terrorism financing, aligning with international standards.
Furthermore, this year, Hong Kong plans to refine its approach to regulating fiat stablecoins, with proposals to be discussed in the Legislative Council. This is part of a broader strategy to ensure that virtual asset service providers, including those facilitating over-the-counter transactions, adhere to regulated, safe practices.
These steps reflect a cautious but progressive approach to cryptocurrency by Hong Kong’s financial leaders. They recognize the need to balance innovation with financial security, aiming to position Hong Kong as a responsible and forward-thinking player in the global crypto economy.
