- Hong Kong regulator suggests issuing digital Hong Kong dollar stablecoin.
- The lawmaker believes this would bolster web3 development.
- Hong Kong has been actively looking to regulate cryptocurrencies.
According to Wu Jiezhuang, a member of the e Hong Kong Legislative Council, developing the nation’s digital Hong Kong dollar into a stable currency could offer a slew of benefits for the nation and play a significant part in drawing in web3 startups to the nation.
Jiezhuang is a founding member of G-Rocket, a startup accelerator he co-founded along with Legislative Council member Johnny Ng Kit-Chong in 2016. The program plans to help 1,000 Web3 start-ups set up their businesses in Hong Kong in the coming years.
Jiezhuang’s comments came in a recent interview, where he discussed the perks of turning the nation’s digital dollar into a stablecoin. Per Jiezhuang, the current stablecoins are primarily issued by private entities and haven’t been able to bolster market confidence, especially following recent events that saw the collapse of several stablecoin economies.
As such, Jiezhuang urges that the Hong Kong government can consider issuing the digital Hong Kong dollar as a stablecoin, and connect it to the decentralized finance eco-systems, thus allowing the web3 ecosystem to benefit from it. The regulator believes such a stablecoin could become an integral part of the web3 ecosystem and virtual asset trading platforms in the nation.
Meanwhile, Hong Kong has been actively eyeing cryptocurrency adoption in a regulated environment. As reported by Coin Edition, following a crucial change to provincial legislation, industry participants in Hong Kong’s financial services sector are actively establishing the groundwork to allow retail users to trade virtual assets in the coming months.
In addition, the Hong Kong government approved a change to the Anti-Money Laundering and Counter-Terrorist Financing Act last month, making the Securities and Futures Commission (SFC) responsible for regulating virtual-asset service providers.
The amendment introduces a licensing mechanism for enterprises that offer virtual asset services, allowing regular people to exchange them. Previously, only institutional investors with a minimum of $1 million in liquid assets were allowed to invest in digital assets.
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