How do you view the regulatory challenges faced by Hong Kong's virtual asset hub ambitions, and what do you think can be done to overcome them?

 

Hong Kong’s ambitions to become a virtual asset hub face a number of regulatory challenges, particularly as the country seeks to strike a balance between encouraging innovation, maintaining financial stability and ensuring investor protection. Some of the key challenges include:

1. Regulatory clarity and compliance: Hong Kong regulators, particularly the Securities and Futures Commission (SFC), have been cautious in regulating virtual assets. The key challenge is to develop clear and flexible guidelines that provide enough clarity for businesses without stifling innovation. Uncertainty about licensing requirements and regulatory boundaries may prevent new companies from entering the market. Solution: Enhance collaboration between regulators and industry stakeholders to develop clear and practical regulations. The SFC has made progress in implementing the licensing regime, but continuing to improve these regulations based on feedback will help create a more friendly environment.

2. Global regulatory harmonization: Virtual assets are global in nature, so