Hong Kong patient approach to crypto regulating will pay: Legco’s Duncan Chiu

Crypto regulations are a competitive business in Asia, with areas such as Hong Kong and Singapore that stand to become Asian crypto hubs and get all the businesses associated with that status.
However, the challenge lies in making a rulebook balancing investor protections with a welcome to businesses and new capital. And here, Hong Kong has an advantage in places like Japan or Korea, as the common framework of traditional finance law has become its economy one of the most open and free in the world-a Recent report From a Canadian thinking tank that Hong Kong is considered the “freest economy” in the world, along with Singapore behind it in the second place.
In Crypto, however, Hong Kong is moving a bit, especially compared to Singapore. But Duncan Chiu, a member of the Legislative Council of Hong Kong and chairman of the Technology and Innovation Committee, who oversees Hong Kong technology and research facilities, says the preliminary territorial care of the territory with respect to Regulating crypto has its advantages.
“Being a late Mover is a good thing sometimes because you have a clear picture,” Chiu said in a recent -only interview with CoinDesk. For example, he taught how Singapore’s financial authority (MAS), the city’s main financial regulator, quickly moved to pass the rules for crypto. The MSA first controlled the crypto under the law of payment services, treating the crypto inaccurately as a payment tool rather than an asset class. Japan did the same thing in advance, forcing Later changes In 2024 as the defi and tokenization eventually gained traction.
“As Hong Kong started late, the good thing had clearer patterns of how these products were used,” said Chiu, who is one of the most well -known voices for the crypto in Hong Kong, with fellow members of Legco Johnny ng. Chiu further stated how the original Bitcoin White paper labeled the asset class as electronic cash, while market reality became more than one commodity – a The view is shared Through the US Commodity and Futures Trading Commission – as another example of how market behavior around crypto has changed and requires regulations to adapt.
Aviation regulation in developing
One of the main issues Chiu said he wanted to work with Legco was to develop a clear classification for a wide variety of digital possessions, such as cryptocurrencies compared to stablecoins, while It also works with global regulators to ensure their alignment.
“We need clear definitions and segments,” Chiu explained. “Some possessions should be regulated such security, while others should remain irregular, such as memecoins.”
According to Chiu, Memecoins should be treated as collectivity, such as Pokémon cards or stamps.
“The memecoins have no operation behind them – they do not use smart contracts,” Chiu said. “They are only collected items, so I see no reason to fix them like financial products.”
A dedicated crypto regulator?
Given how unique crypto as a class of possession, some constituents, such as Dubai and the Virtual Assets Regulatory Authority (VARA), have created their own separate regulators for virtual properties.
When asked if he felt Hong Kong should take the same path, Chiu recalled that in his early years at Legco, he first supported the creation of a digital version of the Securities and Futures Commission (SFC), the regulator of the Territory market, called “ESFC.”
However, the Hong Kong government was instead chosen to maintain crypto administration under existing financial regulators. The SFC has a dedicated digital asset team, while the Hong Kong Monetary Authority (HKMA) administers Stablecoins. Chiu said that so far, he enjoys this repair, especially as SFC Expands its headcount Even the government calls for austerity elsewhere.
“The government’s intent is to keep everything under the SFC. They will have a team within the SFC, and they rented it. We just approved that to Legco,” Chiu said.
Legco’s Crypto priorities
Chiu has seen the establishment of OTC trade regulations and carers as the next top priorities for Legco, while leaving building policies around crypto derivatives and that -in -− – -— – -lyveraging trading in exchanges of SFC and Crypto, rather than passing new laws.
CHIU considers the crypto regulation of a top five priorities, others are mostly around Hong Kong’s economic recovery and public safety issues. But he recognizes that not all of his fellow Legco members share the same rush about crypto regulation, with some who want to focus on developing more strict investor protection mechanisms, to avoid another FTX or JPEXboth that the failures left much in Hong Kong – and around Asia – with a huge hole in their digital wallets
However, there are only a lot of legal bandwidth available. Hong Kong’s job market is weak, and the real estate sector is in Precipice of a painful correction. Hong Kong is also caught between the US and Mainland China in Donald Trump’s next trade warMaking an economic recovery that is challenging for the territory.
“Some Legco members are a big supporter of virtual ownership, but not all, of course,” Chiu said. “They all have different priorities.”