Legislative Council member Johnny NG Kit-Chong of Hong Kong is currently gathering input from industry players around the world to put forward policy recommendations and thematic discussions on the future direction of Web3 and digital assets. The Legislative Council has established a Subcommittee on Web3 and Virtual Asset Development to promote the growth of Web3 and digital assets in Hong Kong. The proposal will be thoroughly studied, summarized, and submitted to the government through the Legislative Council with the goal of shaping Hong Kong’s policy and regulatory landscape to position it as a global hub for Web3 innovation.
The council is seeking feedback on various critical aspects of Web3 policy development, including creating a cohesive environment for the development of Web3 with robust and clear regulations. Additionally, it aims to enhance international cooperation to solidify Hong Kong’s position as a globally connected Web3 hub, explore the convergence of artificial intelligence and Web3 technology, and craft policies to support the healthy development of decentralized autonomous organizations (DAOs).
In addition to Web3 policy, the Legislative Council is focusing on the digital asset industry and working to identify measures to facilitate its growth in Hong Kong. This includes exploring ways to enhance investor and consumer protection, boost market confidence, and safeguard digital asset investors. The council also plans to assess the potential benefits and risks of stablecoins, develop regulatory frameworks that balance financial stability with innovation, and address the growing need for professional custody services for virtual assets.
The Hong Kong government formed a task force in July 2023, consisting of 15 industry participants and 11 key government officials to oversee the development of Web3 and focus on promoting its growth ethically. However, the number of crypto exchanges seeking operational licenses in Hong Kong has been steadily decreasing, with crypto exchanges IBTCEX and QuanXLab withdrawing their applications filed in February 2024.