Hong Kong to further optimise digital asset regulation

Officials from the Legislative Council of the Hong Kong Special Administrative Region underlined that the initiative supports the development of the technology industry, with regulators planning to establish a secure exchange system and introduce legislation related to stablecoins, which are set to be launched in the region by the end of 2024. At the time of the announcement, sandbox tests were already conducted, with the government intending to improve the supervision and enforcement of legislation regarding digital asset financial products within one to one and a half years. Moreover, the next phase is set to encourage project parties to discover more financial products in Hong Kong.

Also, the upcoming stablecoin legislation highlights the region’s financial approach towards cryptocurrencies, focusing on fostering advancing capabilities while maintaining regulatory compliance and supervision. Demonstrating its attention to security in the crypto landscape, the Hong Kong Police recently detained four individuals connected with a scheme involving counterfeit banknotes leveraged to defraud cryptocurrency investors. These arrests were part of broader law enforcement efforts that intended to address the increase in crypto-related scams in the area. At that time, representatives from the Commercial Crime Bureau disclosed that these arrests brought the number of individuals detained in relation to these scams to 14 since October 2023.