Hong Kong has announced the decision to ease rules to promote virtual asset trading liquidity and the launch of the `Fintech 2030` strategy.
Following this announcement, Hong Kong's Securities and Futures Commission (SFC) is set to ease rules in order to allow locally licensed virtual asset trading platforms (VATP) to share global order books with affiliates overseas.
In addition, the move is set to ease current rules that require VATP's order book (representing a list of buy and sell orders for virtual assets) in order to be ring-fenced in Hong Kong, as the changes were designed to allow operations to tap global liquidity.
Additionally, VATPs are expected to now be allowed to distribute virtual assets and Hong Kong-regulated stablecoins with less than a 12-month track record to professional investors, representing a strategy focused on easing previous requirements for a minimum one-year track record.
More information on Hong Kong’s decision to ease virtual asset rules and launch `Finance 2030`
According to Reuters, the strategy comes as Hong Kong focuses on the process of competing in an initiative to become a global fintech and digital asset hub against rivals such as Singapore and the US market, amid the overall surging appetite for digital investments. A the same time, Hong Kong's banking sector is currently poised to benefit from rising investment in digital transformation, according to the city's de-facto central bank.
Meanwhile, the Hong Kong Monetary Authority unveiled its `Fintech 2030` roadmap, which was developed in order to focus on data, artificial intelligence, resilience, and tokenisation. The initiative will prioritise four strategic pillars, collectively known as `DART`, with a comprehensive portfolio of over 40 initiatives.
These will include the process of developing an optimised data and payment infrastructure (which aims to support secure, efficient, ans scalable data sharing, as well as further accelerate cross-border payment connectivity), a new `Artificial Intelligence x Authorized Institutions` strategy (AI2Strategy – which will further drive comprehensive and responsible adoption of AI across the financial sector, as well as launching shared AI infrastructure and finance-specific models in collaboration with industry stakeholders), the process of improving business, technology, and quantum resiliece, as well as tokenisation of finance (this will take place through the process of accelerating the tokenisation of real-world assets, including financial assets, and regulatising the issuance of tokenised government bonds and exploring the overall concept of tokenising the Exchange Funds paper).
At the same time, as part of the strategy, HKMA also mentioned that it will further optimise its sandbox Ensemble in order to allow real-value transactions in tokenised deposits and digital assets. The institution will begin incubating mature real-value use cases where tokenised deposits can offer significant advantages, starting with tokenised money market funds. However, the regulator did not disclose details of such real-value applications.
