Paul Chan says, Despite market uncertainty, it is the “right time” for Hong Kong to pursue Web3

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By Degen Lipsa

Hong Kong has already made significant efforts to advance the Web3 sector, and Paul Chan, its financial secretary believes it’s the best time for Hong Kong to pursue Web3.

Paul Chan detailed that one of the three main approaches he has suggested in the city’s budget was for the advancement and deployment of Web3 in a blog post from April 9.

Chan stated that Hong Kong will “implement a strategy that stresses both ‘appropriate regulation’ and ‘supporting development'” in order for “Web3 to steadily travel the path of innovative development.”

Chan says the region also plans to focus on financial security, preventing systemic risks and focus on investor education, protection and measures around anti-money laundering.

Paul Chan admits its the right time for Hong Kong to pave ways in the world of Web3
Paul Chan thinks it’s the right time for Hong Kong to advance in Web3

The Hong Kong government first suggested proposing legislation to control cryptocurrency in October of last year.

The local securities authority in Hong Kong, the Securities and Futures Commission (SFC), published a proposal for a regulation of cryptocurrency exchanges on February 20 of this year, with an implementation date of June 1.

The business has been experiencing a brutal bear market, setbacks like exchange crashes, and constant regulatory scrutiny.

Chan claims that the market is merely going through the same process the Internet did in the early 2000s, when the “bursting of the bubble” caused investors to become much more composed.

The surviving strong firms will put more effort into competing in technological innovation, real-world application, and value creation as the tide of speculation recedes, Chan wrote. This will help to raise the standard of the real economy.

“Market participants need to deepen the development of blockchain technology in the subsequent stage so that its characteristics and benefits of transparency, efficiency, security, disintermediation, deplatformization, and low cost can find broader application scenarios and address more existing problems,” according to the report.

Hong Kong’s attitude to cryptocurrency regulation is very different from that of the US, which has taken a more rigid stance, which has given rise to speculation that the “centre of gravity” of the crypto business would move to Hong Kong.

Following the local government’s proposed 50 million Hong Kong dollar ($6.4 million) capital injection into Web3 in the city’s 2023–24 budget, cryptocurrency exchange Gate.io has already made arrangements to establish a foothold in Hong Kong.

Christian Hui, the secretary for financial services and the treasury, claimed in a speech on March 20 in Hong Kong that since October 2022, Hong Kong has been gaining “attention” from various crypto enterprises globally.

In his most recent piece, Chan stated that “the path of innovation and technological progress has never been easy sailing.”

“Even though the direction of progress is set, the real path must be worked out step by step; only by persevering in our efforts can we uncover new solutions and new ways out,” he continued.

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