Hong Kong Advances Crypto Regulation and Tokenization Framework

Hong Kong's government has unveiled its second major policy statement on digital assets, reinforcing its ambition to establish the region as a global crypto hub. The framework emphasizes risk management and investor protection, with oversight by the Securities and Futures Commission. Licensing regimes for custodians, exchanges, stablecoin issuers, and service providers will soon undergo public consultation.

The MOVE builds on Hong Kong's 2022 pledge to engage with industry participants. Recent milestones include licensing four crypto exchanges in December and enacting stablecoin legislation effective August 1. The Financial Services and Treasury Bureau (FSTB) and Hong Kong Monetary Authority will review tokenization of real-world assets (RWAs) and financial instruments, focusing on bond issuances and transactional applications.

Financial Secretary Paul Chan highlighted the government's focus on practical tokenization use cases and diversification. The global RWA tokenization market has surged 380% in three years, reaching $24 billion—a trend Hong Kong aims to capitalize on through its progressive regulatory approach.