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Hong Kong lawmaker Johnny Ng has questioned whether or not town’s authorities is contemplating Bitcoin as a part of its funding technique.
He raised these views in a Dec. 11 assertion, highlighting the rising international recognition of Bitcoin and its decentralized nature regardless of its inherent dangers.
The Bitcoin reserve query
Ng questioned if the Hong Kong authorities may discover integrating digital belongings into its fiscal reserves. He additionally requested if the Change Fund, the funding arm of the Hong Kong Financial Authority (HKMA), might purchase and maintain Bitcoin for long-term strategic functions.
The lawmaker additionally questioned whether or not the federal government had evaluated the potential affect of international international locations treating Bitcoin as a strategic reserve asset, notably on Hong Kong’s financial stability and the Hong Kong greenback system.
He requested:
“[Has] the federal government assessed and studied the affect of [foreign countries] positioning bitcoins as strategic reserve belongings on the monetary safety of China and Hong Kong?”
Ng emphasised Hong Kong’s benefit as a frontrunner in crypto innovation. He referred to as for a strategic strategy to safeguard monetary safety whereas leveraging town’s distinctive place within the crypto sector.
Authorities’s response
Joseph Chan, Appearing Secretary for Monetary Companies and the Treasury clarified that the Change Fund focuses on globally diversified belongings to handle threat and optimize returns.
He famous whereas digital belongings should not explicitly included in its portfolio, exterior fund managers may sometimes interact with them. Nevertheless, these investments stay minimal. As of Sept. 30, the Change Fund reported whole belongings of HK$4,133.9 billion (roughly $530 billion).
In the meantime, Chan acknowledged the rising integration of digital belongings (VAs) into conventional finance. He highlighted the potential advantages of blockchain know-how, akin to improved effectivity and transparency. Nevertheless, he additionally identified dangers associated to monetary stability, cash laundering, and investor safety.
However, the federal government plans to keep up a balanced regulatory framework that mitigates these dangers whereas fostering accountable innovation. This strategy helps Hong Kong’s place as a number one worldwide monetary hub.
He added:
“The Authorities and regulators will proceed to formulate regulatory regimes to deal with such dangers beneath the precept of “identical actions, identical dangers, identical rules”. This strategy can create a facilitative surroundings to foster innovation in a sustainable and accountable method.