Hong Kong is “very ready” for the next wave of mass crypto adoption, with an inflow of crypto expertise that has been spilling into the aspiring digital asset hub, says Jupiter Zheng, a accomplice at Hashkey Capital.
Speaking to Cointelegraph, Zheng, accomplice of liquid funds and analysis on the funding arm of Hong Kong crypto agency HashKey Group — defined that the mixture of new Web3 projects together with crypto-positive regulatory developments has primed Hong Kong for vital progress within the next 4 to 5 years.
“You’ve got all of these new, different projects, with their founders and teams here, which is all real GDP by the way. These teams are already boosting both banking and capital market activities.”
Zheng added that while crypto prices haven’t reflected it, the level of sophistication being developed in the sector over the past 18 months had been striking.
“The actual technological improvement we’ve seen throughout the bear market has been quite astonishing. So I think from the technology side, we are very ready for the next wave of larger mass adoption in the crypto world,” stated Zheng.
The motive for his bullishness for the area was based mostly on the idea that the economic system in Hong Kong is in dire want of a brand new driver, one thing that Zheng believes the crypto sector is prepared to provide.
“The GDP in Hong Kong in recent years hasn’t been looking so good — largely due to Covid. So it needs a new driver,” Zheng stated. “So it’s my theory that crypto and Web3 are the new drivers here.”
@mar2424 Jupiter Zheng, HashKey Capital’s Partner of Liquid Funds and Research, spoke at a panel dialogue at CVCF final week with the theme “Navigating the Web3 Investment Landscape: Emerging Trends to Watch in 2023–24”. pic.twitter.com/P5Yg1StzfI
— HashKey Capital (@HashKey_Capital) November 6, 2023
On Aug. 3 this 12 months, Hashkey became the first crypto exchange in Hong Kong to obtain a particular license that allowed them to provide crypto property to retail traders.
Zheng admitted that whereas he’s indirectly concerned within the change arm of Hashkey, he expects the demand for crypto merchandise from native Hong Kong residents to develop as the federal government continues to shore up investor issues by outlining its regulatory scheme for the sector.
“The recent policy changes give retail investors safety because now you’ve got insurance and legal protections,” he stated.
“You don’t have to use online wallets to do self-custody. All you need to do is open an account on an exchange, and then you can use your Hong Kong dollars to buy Bitcoins and other crypto. It’s quite easy.”
“For now it’s still a bear market, but when the bull market comes back, we can assume that people’s outlook will change quickly. Retail will definitely be coming back, especially when they have a lot of opportunities to buy securely with licensed exchanges,” Zheng added.
Overall, Zheng predicts that Web3 in Asia and Hong Kong will witness the same sample of growth to that of the GameFi sector in South East Asia in 2021, which noticed Axie Infinity briefly become one of the most-played games on this planet.
In Zheng’s view, whereas Axie was susceptible to huge hypothesis, the underlying mannequin of growth can be related — initiatives which can be developed within the U.S. and Europe may simply discover a welcoming market in Asia.
“I think in the future Asia will still follow the same pattern. Protocols and infrastructure projects that are developed in the United States or Europe or Australia may not witness massive adoption where they’re developed — but if they want to find a market they can go to Asia.”
Related: Swiss crypto bank SEBA gets Hong Kong SFC license
Zheng conceded that progress can be much less feverish than as soon as seen in South East Asia, with extra of a sober and well-regulated focus on protocols and blockchain infrastructure, in place of rampant speculation on gaming.
Hong Kong’s burgeoning digital asset coverage is paving the way in which for the way forward for #Web3
Our Partner of Liquid Funds and Research, @mar2424 shares his insights into the developments and alternatives which can be reshaping the trade and the remainder of the world at giant.
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— HashKey Capital (@HashKey_Capital) November 7, 2023
It’s value noting that Hong Kong was rocked by a crypto exchange scandal in September, wherein an unlicensed change known as JPEX allegedly swindled traders out of some $165 million. The fallout has since been described because the one of the worst financial crises to have ever hit the area.
Despite the debacle, Hong Kong’s secretary for monetary providers and the treasury Christian Hui assured a crowd of traders, authorities officers and different regulators at HK Fintech week that the JPEX drama hadn’t affected the federal government’s aspirations to flip Hong Kong into Asia’s crypto hub.
Hong Kong additionally pledged to tighten its crypto laws after JPEX’s alleged actions. The SFC additionally arrange a task force with the police to cope with illicit crypto change actions and updated its policies on crypto gross sales and necessities.
Asia Express: Chinese police vs. Web3, blockchain centralization continues
