The Challenges and Opportunities of Hong Kong Becoming a Global Web3 Hub

Hong Kong is striving to establish itself as a global Web3 hub, but relying solely on a完善的监管框架 is not enough to achieve this goal. In addition to formulating clear rules, Hong Kong also needs to become a leader in digital asset technology infrastructure to attract the best talents in the industry.

The Hong Kong Monetary Authority recently released a document on the regulation of stablecoins, which aligns with Hong Kong's strategy of integrating the next generation of digital assets with its mature traditional financial ecosystem. This initiative highlights Hong Kong's progress in establishing a comprehensive regulatory framework and reflects its core advantages in becoming a Web3 hub.

However, merely having a sound regulatory framework is not enough for Hong Kong to stand out in global competition. Compared to other potential hubs like Silicon Valley, Dubai, and Singapore, Hong Kong needs to take the lead in digital infrastructure that supports the creation and trading of digital assets.

Hong Kong was once the birthplace of many well-known cryptocurrency exchanges and still has the most Bitcoin ATMs in Asia. However, since 2019, due to the pandemic and cautious policies, Hong Kong's position in the global cryptocurrency industry has declined. Nevertheless, missing out on the frenzy and downturn cycles of the cryptocurrency industry may not be such a bad thing. Many companies established during this period are now facing financial difficulties or criticism due to environmental impacts.

As the cryptocurrency industry enters a reset mode, Hong Kong has the opportunity to redefine the development direction of the Web3 hub. The Chinese government has begun to view blockchain and digital assets as potential drivers of economic growth, and Hong Kong has received support to explore paths of innovation and global integration. At the same time, after recent events, the US and Europe have tightened cryptocurrency regulations, which may lead to more digital asset-related activities shifting towards the East.

As one of the world's most powerful capital markets, Hong Kong has a complete financial regulatory framework and top-notch fintech talent. This makes it an ideal place for creating practical applications of blockchain projects, especially in the field of asset tokenization. The Hong Kong government is committed to creating a favorable environment for public-private partnerships, which helps digital assets better integrate into the real economy.

Hong Kong can also leverage the technological entrepreneurship resources of mainland China. Many Chinese internet giants listed in Hong Kong have begun to venture into the digital asset and Web3 fields, and Hong Kong may become an important base for their development.

However, Hong Kong also faces challenges on its path to becoming a Web3 hub. The existing regulatory framework may not be suitable for the rapidly evolving digital assets and frontier technologies. Hong Kong's principle of "same business, same risks, same rules" may restrict bottom-up innovation. Furthermore, Hong Kong needs to develop differentiated digital asset technology infrastructure to bridge the gap in technological resources with other hubs.

The security of digital assets requires new technological solutions, such as multi-party computation, to ensure that asset owners have full control or co-management rights over their assets. Hong Kong needs to develop Web3 infrastructure suitable for institutional business, including custody, institutional wallets, and digital security solutions.

Overall, Hong Kong is in a favorable position to draw on the lessons learned from the past few years to establish a Web3 hub with an appropriate regulatory environment and technical infrastructure, effectively managing risks while promoting innovation.