Editor | Wu Blockchain
Mr. Leung Hon-king leads the Financial Services and Technology, Sustainable Development team of the Hong Kong Special Administrative Region's Invest Hong Kong, attracting international and mainland financial services, technology, and sustainable development companies to Hong Kong to help enrich the financial ecosystem. Prior to joining the government, Mr. Leung Hon-king was the founder of a technology company, an angel investor, and a financial technology lecturer. Mr. Leung Hon-king's first data-related startup was established through early investment from Credit Suisse Group. His company directly serves many well-known financial institutions, including wealth management, insurance, and consumer finance. Mr. Leung Hon-king has also served as a management consultant at Booz Allen & Hamilton and KPMG, as well as a venture capitalist at Innovate@, a technology fund jointly operated by Booz Allen & Hamilton and Lehman Brothers. Mr. Leung Hon-king holds an MBA (Honors) in Finance and Strategy from the University of Chicago and a Bachelor of Science (Honors) in Mechanical Engineering from the University of Wisconsin-Madison.
Question: What work is Invest Hong Kong currently responsible for in the web3 field?
Answer: First, investment promotion. Our core responsibility is to attract and support enterprises to enter the Hong Kong market. Our target clients include mainland and international enterprises interested in the Hong Kong market, covering enterprises from the mainland, the United States, the United Kingdom, and Chinese-background startups. We assist these enterprises in establishing a presence in Hong Kong and connect them with relevant resources.
Second, industry promotion and event support. We actively participate in and sponsor various industry events, such as the Consensus conference, where we are one of the sponsors. In addition, we also host or support large-scale industry events, such as the "Hong Kong FinTech Week", which is also one of the projects our team is responsible for. Through these events, we hope to provide a platform for exchange and development for enterprises and industry leaders in the Web3, virtual assets, FinTech, and blockchain fields, and attract more relevant enterprises to enter Hong Kong.
Third, policy feedback and industry communication. Due to our close daily work with enterprises, we are able to understand the latest industry dynamics and the actual needs of enterprises in a timely manner. Therefore, we also play a "market feedback" role within the government, frequently communicating with colleagues responsible for policy formulation and regulation, conveying the voice of the market to decision-makers and regulatory authorities, ensuring that policies can better meet the development needs of the industry.
In addition, as a government publicity and promotion platform, Invest Hong Kong also undertakes the role of industry promotion. We hope that through our promotional resources, more people can understand important industry dynamics, such as the landing of international conferences like Consensus in Hong Kong, and showcase Hong Kong's potential as an Asian Web3 development center.
Furthermore, we are also responsible for connecting industry resources. For example, if Consensus needs to establish an ecosystem in Hong Kong or seek cooperation with the government and private enterprises, we can use Invest Hong Kong's in-depth understanding of local resources to provide them with effective connection support and facilitate more cooperation opportunities.
Question: Has Hong Kong's support for web3 undergone a transformation?
Answer: In fact, Hong Kong has always been very supportive of the Web3 field, and the reason behind this is quite simple. Hong Kong is a free market where capital can flow freely, and Hong Kong's economic system is inherently well-suited for the development of cross-border, borderless industries, such as cryptocurrencies and Web3. Essentially, the core characteristics of these industries are globalization and decentralization, so Hong Kong naturally has the advantages to develop these industries.
Invest Hong Kong has been paying attention to this emerging industry for a long time and has been providing support. At the same time, as mentioned earlier, we collect industry feedback in our daily communication with enterprises and convey market demands to policy bureaus and regulatory authorities, hoping that policymakers can pay timely attention to industry development trends. Therefore, our support has been continuous and stable.
Question: Is Invest Hong Kong a subordinate organization of the policy bureau?
Answer: Invest Hong Kong is under the Commerce and Economic Development Bureau and often collaborates with other policy bureaus. Senior officials in the policy bureaus need to take a holistic view and consider the overall interests and long-term development of Hong Kong, while Invest Hong Kong is on the market frontline and can observe the development trends of emerging industries more quickly.
Our role is more like a "market intelligence hub", where we collect industry dynamics through daily contact with enterprises and feed this information back to relevant government departments, helping them better formulate policies.
Question: How do you currently support local enterprises?
Answer: The enterprises we support are not limited to local companies, but also include those with overseas Chinese backgrounds or international backgrounds. Their needs are mostly concentrated in customer expansion. For example, some Web3, virtual asset, or blockchain-related enterprises, if their target customers are banks, it can be quite difficult to connect directly, especially for enterprises that have just entered the Hong Kong market.
For example, if a well-known blockchain company from Switzerland has just entered the Hong Kong market, if they try to approach local banks on their own, it may take a long time to establish trust and cooperation. However, if this company goes through our Invest Hong Kong, we will first conduct a background investigation to ensure its good reputation, and then directly make precise introductions and connections to relevant large banks or financial institutions.
The same logic also applies to Hong Kong's investment institutions, such as venture capital and government-backed funds. We will help enterprises find suitable investors or partners more quickly, improve the efficiency of connections, and accelerate the establishment and development of enterprises.
Question: Are there any enterprise cases that have left a deep impression on you?
Answer: The actual application of blockchain technology is crucial to the entire Web3 and virtual asset industry, especially in terms of cooperation with regulatory authorities. For example, the Hong Kong Monetary Authority (HKMA) launched the Project Ensemble initiative last year, which is an extremely influential program aimed at promoting the development of Real-World Assets (RWA).
This project not only attracted the participation of large banks and technology companies, but also opened up pilot and sandbox testing to international innovative institutions. However, many overseas enterprises, even if they know that HKMA has launched this project, may not necessarily know how to join or connect with the responsible personnel. As HKMA is a large organization, it is not easy to find the right contact person.
In this case, our Invest Hong Kong played a key role - helping these overseas enterprises connect with the relevant HKMA personnel, so that they could smoothly join Project Ensemble and promote the development of the entire industry. Last year, this project made significant progress, which also reflects our important role in facilitating industry cooperation.
Question: Will you support enterprises that issue coins through ICOs?
Answer: At the moment, Hong Kong's support for ICO (Initial Coin Offering) enterprises is cautious and has certain thresholds. Although the market has a high demand for token issuance, the Hong Kong regulatory authorities are more focused on investor protection, ensuring the compliance and safety of the market.
Hong Kong policymakers need to find a balance between an open market and investor protection. For example, licensed trading platforms need to conduct strict due diligence (DD) before listing tokens, ensuring the legality and feasibility of the projects. Only projects that have passed this layer of screening can be listed on compliant trading platforms in Hong Kong.
The market has a high demand for more token listings, while the regulatory authorities need to ensure that the rights and interests of retail investors are not harmed. Therefore, the development of this field in Hong Kong will be a gradual process, needing to meet market demand while ensuring compliance and safety.
Question: Why does Hong Kong focus on the development of digital assets, such as the previously launched stablecoin sandbox and the Ensemble project?
Answer: This is actually a very reasonable choice, as Hong Kong has always been an international financial center, and digital assets are an important part of financial innovation.
If we ask people about their impression of Hong Kong, many (both Chinese and foreigners) will immediately think of it as a "financial center". From the perspective of the capital market, Hong Kong's market size and liquidity far exceed many of its competitors. For example, in 2024, more than 70 companies successfully listed in Hong Kong, raising a total of over 80 billion Hong Kong dollars. In contrast, Singapore only had 4 companies go public that year, raising about $3 billion, which is only about 30% of Hong Kong's financing scale.
For emerging industries, the liquidity of the capital market is crucial, and Hong Kong has a significant advantage in this regard. This is why many global fund management companies choose Hong Kong as the base for their asset management and capital operations.
In addition, the Hong Kong government is also actively promoting other financial innovations, such as Green Finance. The Hong Kong Monetary Authority (HKMA) became the world's first government agency to launch a Tokenized Green Bond project in 2023, and conducted a second tokenized green bond issuance in 2024. Furthermore, the Hong Kong government has also set up a subsidy of up to 2.5 million Hong Kong dollars to encourage institutions to issue tokenized green bonds in Hong Kong.
Against this backdrop of financial innovation, Hong Kong naturally attaches great importance to the development of digital assets, including the launch of a stablecoin sandbox, Project Ensemble, and other initiatives to further promote the development of virtual assets and tokenized finance.
Question: What do you think is the development direction of Hong Kong's fintech and web3 industries?
Answer: First, stablecoins and cross-border payments. The Hong Kong Monetary Authority (HKMA) has a positive attitude towards the development of stablecoins and is committed to promoting its ecosystem. The core logic behind this is that as the world's third-largest financial center, Hong Kong's focus is on application scenarios with economies of scale and far-reaching impact, rather than simply on meme culture or short-term hot spots. Among these, cross-border payments are one of the most promising application scenarios for stablecoins, especially in the B2B field. Many mainland Chinese exporters and e-commerce companies sell goods to emerging markets (such as Africa, South America, the Middle East, and Southeast Asia), but the existing cross-border payment systems have two main problems: long transaction times (funds can take days or even a week to settle) and high costs (payment fees in some regions can be as high as 10%, significantly increasing business costs). The application of stablecoins can reduce transaction costs, accelerate fund settlement, and mitigate the risks associated with time delays. Therefore, the implementation of stablecoins in the cross-border payment field is expected to become one of the important directions for the development of Hong Kong's fintech.
Second, the tokenization of real-world assets (RWA). Hong Kong's advantages in asset management make it an important driver of RWA tokenization. As mentioned earlier, Hong Kong's capital market has extremely strong liquidity, and RWA tokenization is a key trend in the era of asset management 3.0. At the end of 2023, Boston Consulting Group (BCG), Invesco, and AxoneChain jointly released a white paper analyzing the potential of the RWA tokenization market. The report pointed out that the estimated size of the tokenized funds market alone is as high as $610 billion. As more and more TradFi (traditional finance) institutions enter the Web3 field, Hong Kong is expected to become an important center for RWA tokenization, promoting the trading and management of securities, bonds, funds, and other assets on the blockchain.
Third, digital culture and Crypto Native industries. Hong Kong is not only an international financial center, but also the world's second-largest art auction market (second only to New York, surpassing London in 2020). Therefore, Web3 has tremendous potential in the areas of digital art, NFTs, and intellectual property (IP) tokenization. Digital art and NFTs: Many second-generation wealthy and high-net-worth individuals are highly interested in digital artworks, and Hong Kong's international environment makes it an ideal place for digital art trading and NFT development. IP tokenization: A large number of well-known IPs are being tokenized through Web3 technology, making the circulation of artistic and cultural products more convenient.
Hong Kong is also a gathering place for Chinese Crypto Native entrepreneurs, especially in the C-end application field. Opportunities for Chinese Web3 entrepreneurs: Many Western markets have an advantage in B-end infrastructure, while Chinese entrepreneurs have accumulated rich experience in C-end applications such as e-commerce, social media, and content platforms in the Web 2.0 era. Hong Kong's friendly policy environment, abundant funding, and convenient access to overseas markets make it an attractive choice for more and more Chinese Web3 entrepreneurs to set up their international headquarters and explore new opportunities in C-end applications.
Question: What important achievements has Hong Kong's fintech industry made in the past few years? How do Hong Kong's regulations and policies support the development of enterprises? How do you think these policies have promoted the growth of Hong Kong's fintech industry?
In the past few years, Hong Kong has achieved remarkable success in the field of fintech, particularly in virtual assets, payment technology, and financial infrastructure. The Hong Kong Monetary Authority (HKMA) and the Securities and Futures Commission (SFC) have successively introduced a series of policies to support the innovative and compliant development of fintech companies. For example, Hong Kong has established a regulatory framework for virtual asset trading platforms and launched a central bank digital currency (CBDC) pilot project. In addition, Hong Kong is also promoting the compliance of stablecoins, attracting more traditional financial institutions to enter the cryptocurrency market.
Currently, the world's largest stablecoin is USDT (Tether), followed by USDC. The competition between the two is becoming increasingly fierce. USDC is more favored by institutional investors in some areas due to its stricter compliance requirements and regulatory licenses. In contrast, USDT lacks a comprehensive regulatory license, and some traditional financial institutions still maintain a cautious attitude. At present, the global trade market size is in the tens of trillions of dollars, while the stablecoin market size is still relatively small, not yet reaching $1.1 trillion (i.e., $1,100 billion). This is mainly because many companies are still looking for regulated stablecoins to ensure the safety and compliance of their funds. Therefore, stablecoins with official financial licenses will become an important bridge for traditional financial institutions to enter the crypto market. As a leading global financial center, Hong Kong has begun to issue stablecoin-related licenses. Regulated stablecoins not only can enhance market confidence, but also may encourage more countries to adopt the stablecoins issued by Hong Kong, whether denominated in renminbi, Hong Kong dollars, or US dollars. This trend will drive the further expansion of the global stablecoin market, with the potential for growth of tens or even hundreds of times in the future.
With Hong Kong's leading position in stablecoin regulation, traditional financial institutions (TradFi) are more likely to enter this field, laying the foundation for the widespread application of stablecoins. Regulatory transparency and market trust will be key factors in driving the growth of the stablecoin industry.
Question: In the context of fierce global competition, what unique advantages does Hong Kong have that make it an ideal location to attract fintech and web3 companies and investors?
Answer: Hong Kong's ability to attract fintech and Web3 companies and investors is mainly due to its unique international advantages, status as a financial center, and role as a bridge between East and West. Hong Kong's international brand effect and financial reputation. Hong Kong is essentially a globally renowned financial brand. Even if many people have not been to Hong Kong in person, when they think of Hong Kong, the first thing that comes to mind is the international financial center. Especially in the fields of fintech and Web3, for companies to obtain a financial license in Hong Kong means a high degree of international recognition. For example, the global recognition of licensed institutions in Hong Kong is high - if a company obtains a license in Hong Kong, it is usually more easily accepted in other markets, enhancing its brand value and compliance reputation. Hong Kong's regulatory system is mature - in the digital asset sector, Hong Kong's regulatory framework is relatively clear, which is particularly important for Web3 companies and institutional investors who wish to operate in a regulated environment.
Hong Kong as a financial hub for the "Belt and Road" initiative. Hong Kong is not only China's international financial center, but also an important node of the "Belt and Road" initiative. Against the backdrop of intensified global economic competition, many emerging market countries in the Middle East, Africa, and Southeast Asia hope to strengthen their economic and trade ties with mainland China, and Hong Kong is a critical financial bridge in this process. Many Chinese companies choose to set up offices in Hong Kong to more conveniently expand into Southeast Asia, the Middle East, and Africa. Many Middle Eastern companies also have a presence in Hong Kong to better attract Chinese companies into their markets. This two-way interaction has made Hong Kong an important hub for connecting global capital, markets, and technology.
Question: Considering your travels to the Middle East, Singapore, Europe and other places, what new insights do you have on the role Hong Kong should play in the global Web3 development? What unique advantages does Hong Kong have, and how should it leverage its strengths and overcome challenges?
Answer: This is a very good question, and I have been thinking about it for many years, haha. When I was on business trips in different countries, I was also verifying this question. In fact, there is a Chinese saying: "Being in blessings but not knowing it." Hong Kong indeed has unique advantages in the global Web3 development. First, one of the key success factors in the Web3 and crypto industry is capital, and Hong Kong is very fortunate in this regard - a large amount of funds are circulating in Hong Kong, and many Web3 VCs are also based here, with relatively abundant capital, which is the first major advantage.
Secondly, in addition to capital, talent is also a crucial factor, including entrepreneurs and engineers. When I was on a business trip in Europe, I observed that the European economic system is relatively mature, and many excellent entrepreneurs may have worked in large banks or financial institutions for 20 years, with rich experience and agile thinking, but the challenge they face is the high labor cost. Hong Kong is relatively fortunate in this regard - although the salary level in Hong Kong is not low, many teams' engineers are distributed in cities like Shenzhen, Chengdu, Xi'an, Nanjing, and Hangzhou in mainland China, while the product managers and project managers are stationed in Hong Kong, responsible for facing the international market. This "front-end Hong Kong, back-end mainland" model is very common, and it also brings advantages in cost control and talent acquisition.
Third, another core advantage of Hong Kong is the application scenarios. Many Web3, Crypto, and Blockchain applications are closely related to finance, and as one of the top three global financial centers, Hong Kong naturally has unique competitiveness. In addition, Web3 also involves aspects such as culture and community, and Hong Kong, as an international metropolis where Chinese and Western cultures converge, has attracted many foreign entrepreneurs, investors, and developers, and this cultural diversity has also created favorable conditions for the development of Web3.
Furthermore, Hong Kong's living environment is also an important factor in attracting Web3 talents. Compared to regions like the Middle East, Hong Kong's climate and dining culture are more friendly to Chinese, with high convenience in daily life, which also makes it easier to attract international talents to live and develop here.
Of course, Hong Kong also faces some challenges in Web3 development, and the most critical one is not external difficulties, but whether the internal execution speed can keep up with the pace of industry development.
We have held many closed-door meetings, allowing industry leaders to directly communicate with policymakers and regulators. Many industry insiders believe that the Hong Kong government has a very open attitude and is willing to listen to the voices of the market, which is a very positive aspect. But at the same time, the market demand is clear, while the pace of policy implementation and regulation needs to be closer to the market rhythm, to ensure that the Web3 ecosystem can be quickly implemented and developed in Hong Kong.
Therefore, I believe that Hong Kong's core advantages lie in capital, talent, application scenarios, and cultural diversity, while the biggest challenge is how to accelerate the speed of policy implementation to meet market demands. As long as these advantages can be fully leveraged and optimized in the execution level, Hong Kong will play an increasingly important role in the global Web3 development.
