Hong Kong possesses distinctive aggressive benefits to develop decentralised finance (DeFi) and the metaverse as these blockchain applied sciences proceed to evolve, in accordance with two surveys by a government-backed physique.
Town’s benefits, primarily based on surveys on DeFi and the metaverse with monetary establishments, embrace a well-defined authorized and regulatory framework, business-friendly surroundings, strong monetary infrastructure and community, and extremely expert expertise.
The rising DeFi and metaverse applied sciences “will likely present various opportunities for the financial services industry in Hong Kong”, stated Enoch Fung, government director of the Hong Kong Institute for Financial and Monetary Analysis (HKIMR), which is backed by the Hong Kong Financial Authority.
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As town makes a giant push to turn into a digital asset and Web3 hub, the experiences supply insights for market individuals and regulators, domestically and internationally, which is able to assist type coverage initiatives and market improvements, Fung stated at a media briefing on Tuesday.
Enoch Fung (left), the manager director of Hong Kong Institute for Financial and Monetary Analysis, and Giorgio Valente, the top of HKIMR, maintain copies of the DeFi and metaverse surveys on Tuesday. Picture: HKIMR alt=Enoch Fung (left), the manager director of Hong Kong Institute for Financial and Monetary Analysis, and Giorgio Valente, the top of HKIMR, maintain copies of the DeFi and metaverse surveys on Tuesday. Picture: HKIMR>
HKIMR coordinated with consultancy PwC to conduct the 2 surveys, learning organisations within the asset and wealth administration, banking, insurance coverage, digital asset and metaverse service industries.
A complete of 59 entities took half within the survey on DeFi, which is the supply of monetary providers with out conventional monetary intermediaries, providing a cheaper, accessible and safe different. In the meantime, 55 establishments joined the survey on metaverse, a know-how platform to expertise digital actuality.
Native market individuals are more and more eager on digital belongings. Greater than half of the monetary establishments within the DeFi survey have already included such belongings into their core enterprise operations, whereas 85 per cent count on to have accomplished so three years from now.
Digital belongings are digital representations of worth that may be digitally traded, transferred, or used for cost or funding functions. They embrace tokenised conventional belongings, stablecoins, cryptocurrencies, NFTs and merchandise round custodian and tokenisation options.
Within the metaverse examine, 65 per cent of the respondents stated they’re concerned within the digital actuality world with functions starting from advertising and marketing and promotion to inside operations and from expertise recruitment to office social occasions that assist promote “interactions with customers, employees and the general public”, stated Giorgio Valente, head of HKIMR.
A typical problem is the dearth of expertise and experience, which impacts the progress of the adoption of those applied sciences, in accordance with the experiences. Different key hurdles embrace uncertainty in governance constructions, authorized and regulatory compliance, cybersecurity and information administration dangers.
Hong Kong has seen a wave of exits by among the largest world cryptocurrency exchanges, together with Binance and HTX, as town has been criticised for its restrictive regulatory regime.
Fung stated the tenet for regulating monetary improvements worldwide has been “same activity, same risk, same regulation” with some native nuances.
“The broad direction [in] the overall international community is to provide a certain level of consistency, coordination and collaboration on many aspects,” Fung stated, referring to monitoring dangers and information gaps.
“Hong Kong regulators have been very active in participating in those regulatory discussions. We have a role to play in the international standard-setting bodies, providing our input and consolidating our role as an international financial centre.”
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