Hong Kong is increasingly positioning itself as a haven for crypto companies, while the United States has become particularly hostile to them. And the emergence of a stablecoin backed by the Hong Kong dollar (HKD) could further cement the autonomous region. This is at least the conclusion of a call from several academics, who invite the government to act.
A stablecoin for Hong Kong?
Hong Kong is increasingly seen as a way for China to experiment with digital currencies – including cryptocurrencies. In this autonomous territory, exchanges of cryptos between individuals have been authorized, and the government has launched numerous calls for companies in the sector to set up there. As a reminder, cryptocurrencies are almost banned in China.
This is probably a continuation of Beijing’s strategy, which relies on a “de-dollarization” of the world. And this is also the position taken by academics in Hong Kong, which underline the interest of a local stablecoin, pegged to the Hong Kong dollar (HKD). In a paper signed in collaboration with Web3 players, they indeed explain that an asset of this type would make it possible to have less recourse to the USD.
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According to the authors, a stablecoin would also be a starting point for Hong Kong, in order to experiment with the digitization of certain assets, and to promote greater financial inclusion. Furthermore, the asset could make international transfers more fluid, which are still largely settled in USD. The use of a blockchain was also highlighted as a security factor.
👉 To learn more – Stablecoin, all about this type of cryptocurrency
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Hong Kong plans to regulate stablecoins
Hong Kong intends to evolve its regulatory framework to include stablecoins. Christopher Hui Ching-yu, the secretary for financial services and treasury, confirmed last month that the independent territory would adopt a “predictable” approach. It’s a hidden reference to the United States, which has been accused for years of maintaining regulatory limbo when it comes to cryptocurrency-related businesses.
Since the fall of Terra (UST), and the weakening of Binance’s BUSD, the United States and Europe have marked the distance with assets of this type. stablecoins are otherwise considered to be competitors of MNBCthe digital currencies issued by Central Banks, which are being developed in all major economies.
The world of cryptocurrencies is therefore apparently polarizing. On the US side, the ruling Democrats are showing clear hostility to the cryptocurrency industry. But Asia sees it as a tool for the “de-dollarization” underway in the worlde, and new opportunities. It is therefore likely that stablecoins will have a particularly crucial political role in the coming years.
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Source: BeinCrypto
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Journalist at Cryptoast, I fell into the pot of cryptocurrencies a few years ago. I am passionate about the innovative technologies that stem from the blockchain and I like to find the most crispy information to share with you.
Marine Debelloir
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