Johnny NG Kit-Chong, a member of the Hong Kong Legislative Council, has announced that they are seeking input from industry players worldwide to propose policy recommendations and hold discussions on the future of Web3 and digital assets. The Legislative Council has established a Subcommittee on Web3 and Virtual Asset Development to promote the growth of Web3 and digital assets in Hong Kong.
The proposal will undergo a thorough study and summary before being submitted to the government through the Legislative Council. The aim of this initiative is to shape Hong Kong’s policy and regulatory landscape, positioning it as a global hub for Web3 innovation.
The council is seeking feedback on various crucial aspects of Web3 policy development. This includes finding a balance between technical, legal, and regulatory frameworks to create a cohesive environment for Web3 development, with clear and robust regulations. The council is also interested in enhancing international cooperation to solidify Hong Kong’s position as a globally connected Web3 hub. This involves exploring the convergence of artificial intelligence and Web3 technology to improve AI regulation.
The council is also focused on supporting the healthy development of decentralized autonomous organizations (DAOs) and attracting and nurturing talent in Web3 technology and financial innovation. In addition to Web3 policy, the Legislative Council is prioritizing the digital asset industry and identifying measures to facilitate its growth in Hong Kong. This includes enhancing investor and consumer protection, boosting market confidence, and safeguarding digital asset investors.
The council plans to assess the potential benefits and risks of stablecoins and develop regulatory frameworks that balance financial stability with innovation. It also acknowledges the growing need for professional custody services for virtual assets and will develop corresponding regulatory measures to support this demand.
In July 2023, the government of Hong Kong formed a task force consisting of 15 industry participants and 11 key government officials to oversee the development of Web3 and ethically promote its growth. However, the number of crypto exchanges seeking operational licenses in Hong Kong has been decreasing steadily. Recently, crypto exchanges IBTCEX and QuanXLab withdrew their applications after initially filing them in February 2024.