Hong Kong's Battle of the Bulge! Policy Declaration Declassified: Global Ambitions Behind the "Age of Embrace" for Virtual Assets

"Under the Lion Rock, never lose."
While the lyrics of this classic song have exploded on the social platforms of Web3 practitioners on both sides of the Taiwan Strait, Hong Kong is completing a "policy reversal" with a stunning gesture - from the stringent defense of cryptocurrencies in 2019 to the high-profile embracing of virtual assets in 2022, the strategic turnaround of this international financial capital is rewriting the rules of the game in the global digital asset landscape. The rules of the game.

The Regulatory Framework Shift: The Triple Breakthrough from Prevention to Embrace

Breakthrough 1: Retail Entry Countdown

While Singapore insists on a "professional investor only" red line, the Hong Kong Securities and Futures Commission (SFC) has already activated the "professional investor only" red line, and the SFC has already activated the "professional investor only" red line."Opening up Virtual Asset Trading to Retail InvestorsThis means that the general public will be able to legally trade cryptocurrencies like Bitcoin in the future. This means that ordinary citizens will be able to legally trade cryptocurrencies such as Bitcoin in the future, and the backing for this decision comes from Hong Kong's new judgment on the maturity of the market - according to a policy paper revealing that38 of the world's top 50 asset management companies have set up virtual asset investment units in Hong Kong.

Breakthrough 2: The Coming of the "Licensed Era" for Exchanges

"Using the Securities and Futures Ordinance to regulate virtual assets in the past was like using carriage regulations to govern the High Speed Rail." This is how a senior practitioner in Hong Kong described the dilemma of the old regime. The new policy clearly states"Virtual Asset Service Provider Licensing SystemIn addition, exchanges will be required to pass six major compliance thresholds, including anti-money laundering and investor protection. It is worth noting that licensees will be given a "pass" to work with traditional banks, which is equivalent to opening the door toUS$800 billion Hong Kong wealth management marketThe door.

Breakthrough III: The "Hong Kong Model" of Cutting Regulation

Hong Kong creatively categorizes tokens into the following categoriesSecurities-based (STO) and Commodity-based (NFT, GameFi)There are two types of cryptocurrency: the former is strictly regulated by the SFC, while the latter is under the jurisdiction of the Commercial Crime Bureau (CCB) of the Hong Kong Police Force (HKPF). This "precise cut" not only solves the regulatory ambiguity, but also has a hidden meaning - while the US SEC and CFTC are still competing for the jurisdiction of cryptocurrencies, Hong Kong has already set up the "SFC" and the "SFC".A regulatory paradigm of "securities for finance and commodities for business"..

Stabilized Currency Battlefield: The State-Level Layout of the Digital Hong Kong Dollar

Hong Kong has prioritized stablecoin regulation after the collapse of the algorithmic stablecoin Luna sent shockwaves around the world. The policy manifesto reveals the lethal weapon that is being pushed through"Three-track numeric Hong Kong dollar (e-HKD)"Programs:

  1. Technical Infrastructure: Adoption of a two-tier central bank-commercial bank distribution structure
  2. Applied Experimental Layer: Trial of green bond tokenization has been launched.
  3. Full landing level: Aims to be the first financial center to synchronize fiat and CBDC operations

The best part of this system is that it uses national credit to provide an "anchor" for virtual asset transactions. When asked about the relationship with the digitization of the Renminbi, the governor of China's central bank, Yi Gang, made an interesting statement at FinTech Week:"We are deepening our technical collaboration with CBDC in Hong Kong."

A real money "war" for people.

Hong Kong's "policy red packet" for Web3 entrepreneurs is rare in the world:

  • HK$1,000,000 Starting Subsidy: From seed stage to overseas expansion, enterprises can apply through the Cyberport, Science Park and other pipelines with overlapping applications
  • US$60 billion sovereign fundNewly established "Temasek" in Hong Kong will focus on fintech investments.
  • PhD with a monthly supplement of HK$32,000: 36-month subsidy scheme for research talents

Even more interesting is Cyberport's 'NFT Trial' - the issuance of a commemorative NFT during FinTech Week, which is not only a technology showcase but also a signal to the world:Hong Kong to Become a Virtual Asset Application Laboratory.

A New Dimension in the Global Financial Center

While Singapore's tighter regulation has led to the withdrawal of several exchanges, Hong Kong's liberalization policy has had a magnetic effect. In the week of the policy announcement,** cryptocurrency derivatives trading in the Asia-Pacific region surged by 47%**, with Hong Kong institutions making the fastest contribution.

Behind this transformation is Hong Kong's deep anxiety and ambition for financial voice. As the Financial Secretary, Mr. Paul Chan, has said:"We want to rebuild Hong Kong's innovative DNA with Web3."From the regulatory framework for securities-based tokens to the technical standards for the digital Hong Kong dollar, Hong Kong is exporting an "Eastern version" of its virtual asset regulatory regime.

History is always surprisingly similar.--Hong Kong used the linked exchange rate system to reshape the financial order in the wake of the 1997 Asian financial crisis; now, 25 years later, the city is trying to redefine the rules of the international financial game in the digital age with a policy statement on virtual assets.

Will Hong Kong be able to put its policies into practice, avoiding the thunder but not the rain, and will Web3 entrepreneurs return to Hong Kong? These questions will be the focus of the next phase of observation. But what is certain is that when the lion of the East decides to turn around and embrace the future, the shaking of the global virtual asset landscape has just begun.

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