Hong Kong Unveils New Regulatory Framework for Digital Assets and Tokenization

Hong Kong's government issued its second policy statement on digital assets, aiming to position the region as a global hub. Key points include:

Establishment of a regulatory framework focused on risk management and investor protection.
The framework will be overseen by the Securities and Futures Commission, covering custodians, service providers, exchanges, and stablecoins.
Public consultations on licensing regimes will commence soon.
Four crypto exchange licenses were granted in December 2022, with new laws to license stablecoin issuers effective August 1.
The Financial Services and the Treasury Bureau, along with the Hong Kong Monetary Authority, will review the legal framework for tokenization of real-world assets (RWAs) and financial instruments.
RWA tokenization has increased by 380% over three years, reaching $24 billion this month.
The government plans to regularize tokenized Government bond issuance and clarify stamp duty treatment for tokenized ETFs.
Other nations, including the U.K., U.S., South Korea, and Pakistan, are also developing regulatory frameworks for crypto companies.
The European Union's Markets in Crypto Assets (MiCA) legislation took effect last year.