Hong Kong lawmaker advocates including Bitcoin in national reserves

Hong Kong lawmaker Wu Jie has urged the city-state’s authorities to combine Bitcoin into its price range reserves, a neighborhood media outlet reported.

The report discovered that Wu proposed that the Hong Kong Particular Administrative Area (SAR) discover the inclusion of cryptocurrencies in its price range reserves and deploy international trade funds to amass and maintain digital belongings for the long run.

The lawmaker highlighted the worldwide implications of main economies together with Bitcoin of their reserves. Wu argued that Bitcoin’s restricted provide may place Bitcoin as a competitor to conventional belongings whereas offering safety in opposition to inflation.

Whereas acknowledging Bitcoin’s volatility, Wu really useful that governments and corporations allocate solely a small proportion of their reserves to the asset. He emphasised that strategic adoption may gain advantage monetary methods with out exposing them to pointless dangers.

Moreover, as “influential” international locations undertake Bitcoin, its worth will stabilize to an extent that results in wider adoption worldwide. This shift may cut back reliance on conventional reserves corresponding to gold and silver, as Bitcoin’s decrease storage and transaction prices present a sensible benefit, he defined.

Wu additionally famous Bitcoin’s rising presence within the mainstream monetary world, citing the Hong Kong Inventory Alternate’s Bitcoin- and Ethereum-linked ETFs and the issuance of licenses for crypto buying and selling platforms.

This dialogue builds on a query from lawmaker Johnny Ng, who had requested the federal government to think about the combination of digital belongings.

China acknowledges Hong Kong’s crypto progress

In the meantime, China’s central financial institution has acknowledged that Hong Kong has emerged as a frontrunner in crypto regulation.

In its 2024 Monetary Stability Report, the Individuals’s Financial institution of China praised Hong Kong’s progress in managing and integrating digital belongings.

In line with authorities, Hong Kong has been actively investigating crypto licensing and categorizing digital belongings underneath securitized and non-securitized monetary belongings. This twin classification system ensures correct oversight and licensing of digital asset buying and selling platforms, particularly safety tokens.

As well as, establishments engaged in digital asset transactions should get hold of regulatory permits earlier than commencing their actions. Moreover, main monetary establishments corresponding to HSBC and Normal Chartered should incorporate crypto asset exchanges into their routine buyer supervision processes.

China’s recognition underlines the numerous progress Hong Kong has made in regulatory developments. This yr, Hong Kong prioritized regulating stablecoins and crypto exchanges, which helped cement its management in Asia’s digital asset ecosystem.

Wu Blockchain first reported the story.