Hong Kong lawmaker urges government to include bitcoin in reserves

The official noted the advantages of cryptocurrency over traditional assets

30.12.2024 - 14:10

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What’s new? Hong Kong lawmaker Wu Jie has urged the government of the Special Administrative Region of the PRC to consider including bitcoin in financial reserves. He noted that the world’s leading economies are already showing interest in BTC, and the cryptocurrency’s limited supply allows it to compete with traditional assets while offering inflation protection.

Material by CryptoSlate

What else is known? Recognizing the volatility of bitcoin, the official advised governments and businesses to allocate only a small percentage of their reserves to the asset. He emphasized that strategic integration of the asset can benefit financial systems without exposing them to unnecessary risk.

Hong Kong to speed up licensing of crypto exchanges

To this end, the securities and futures regulator will promptly form an advisory panel

Moreover, if major countries adopt bitcoin, its value will stabilize to a point that will lead to wider adoption globally. This shift could reduce reliance on traditional reserves such as gold and silver, as bitcoin has the advantage of lower storage and transaction costs.

The deputy also noted bitcoin’s growing presence in traditional finance, mentioning bitcoin and Ethereum-based spot funds available on the Hong Kong Stock Exchange, as well as the issuance of licenses to crypto exchanges by the local regulator.

Singapore overtakes Hong Kong in the number of issued cryptocurrency licenses

Experts interviewed by Bloomberg note that Singapore has a more favorable regulatory environment compared to Hong Kong

The discussion on the feasibility of digital asset integration was started earlier this year by lawmaker Johnny Ng.

In its 2024 Financial Stability Report, the Central Bank of China praised Hong Kong’s achievements in digital asset integration.

Mainland China’s recognition underscores Hong Kong’s significant progress in regulatory development. This year, Hong Kong prioritized the regulation of stablecoins and crypto exchanges, which helped cement its leadership in Asia’s digital asset ecosystem.

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