Christopher Hui, Hong Kong Secretary for Financial Services, Believes in the Potential of Cryptocurrency

Hong Kong Secretary for Financial Services and the Treasury, Christopher Hui, has voiced his thoughts on cryptocurrency during Hong Kong FinTech Week. Hui, whose department is currently piloting a non-fungible token (NFT) offering and tokenizing green bonds, sees cryptocurrency as more of an investment instrument than a bid for freedom from fiat currency.

Hui is particularly excited about the tokenization of green bonds, which streamlines the issuance and investment process. Hong Kong has already issued $10 billion in green bonds in multiple currencies, and the pilot program for green bond tokenization will focus on institutions and the entire value chain from issuance to settlement, asset servicing, secondary trading, and retention. Hui believes that technology can address bottlenecks in processes such as the subscription for initial public offerings.

Hong Kong differentiates itself from Singapore with its "one country, two systems" approach, which allows the city to be part of China but also to manage its own affairs. As a gateway to China and a link to the international community, Hong Kong is known for its rule of law, regulation, and commercial practices.

When asked about the recently launched Hong Kong Digital Token Offering (HKDTO) framework, Hui declined to comment on whether it will be expanded to cover security tokens. However, he did discuss the central bank digital currency (CDBC) that his department is currently working on. Hui believes the CDBC will be launched in the next two to three years and expects it to be used for interbank settlements and as a means of exchange between businesses. He hopes the CDBC will facilitate cross-border transactions between Hong Kong and mainland China, promote financial inclusion, and improve the efficiency of the financial sector. Hui does not think the CDBC will replace physical cash, but rather will complement it.

Hui also sees potential for NFTs in the art industry and for authenticating and verifying the ownership of physical assets. In Hong Kong, different regulatory bodies oversee different aspects of the cryptocurrency industry, and the FSTB's approach to regulation is to place cryptocurrency within the financial sector and to consider allowing retail investors under the incoming regulatory framework.