Hong Kong lawmaker questions governments stance on Bitcoin amid rising global significance
Hong Kong lawmaker Johnny Ng has questioned whether the citys government is considering Bitcoin as part of its investment strategy.
He raised these views in a Dec. 11 statement, highlighting the growing global recognition of Bitcoin and its decentralized nature despite its inherent risks.
The Bitcoin reserve question
Ng questioned if the Hong Kong government might explore integrating digital assets into its fiscal reserves. He also asked if the Exchange Fund, the investment arm of the Hong Kong Monetary Authority (HKMA), could acquire and hold Bitcoin for long-term strategic purposes.
The lawmaker also questioned whether the government had evaluated the potential impact of foreign countries treating Bitcoin as a strategic reserve asset, particularly on Hong Kongs economic stability and the Hong Kong dollar system.
He asked:
[Has] the government assessed and studied the impact of [foreign countries] positioning bitcoins as strategic reserve assets on the financial security of China and Hong Kong?
Ng emphasized Hong Kongs advantage as a leader in crypto innovation. He called for a strategic approach to safeguard financial security while leveraging the citys unique position in the crypto sector.
Governments response
Joseph Chan, Acting Secretary for Financial Services and the Treasury clarified that the Exchange Fund focuses on globally diversified assets to manage risk and optimize returns.
He noted while digital assets are not explicitly included in its portfolio, external fund managers might occasionally engage with them. However, these investments remain minimal. As of Sept. 30, the Exchange Fund reported total assets of HK$4,133.9 billion (approximately $530 billion).
Meanwhile, Chan acknowledged the growing integration of virtual assets (VAs) into traditional finance. He highlighted the potential benefits of blockchain technology, such as improved efficiency and transparency. However, he also pointed out risks related to financial stability, money laundering, and investor protection.
Nevertheless, the government plans to maintain a balanced regulatory framework that mitigates these risks while fostering responsible innovation. This approach supports Hong Kongs position as a leading international financial hub.
He added:
The Government and regulators will continue to formulate regulatory regimes to address such risks under the principle of same activities, same risks, same regulations. This approach can create a facilitative environment to foster innovation in a sustainable and responsible manner.
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Text source: CryptoSlate
