Following are the opening remarks by the Permanent Secretary for Financial Services and the Treasury (Financial Services), Ms Salina Yan, at the Deloitte's Digital Asset Forum "Digital Assets in Focus - Bridging Traditional and Digital Finance in Hong Kong" today (July 8):
 
Eliza (Senior Advisor of Deloitte China Dr Eliza Chan), Duncan (Legislative Council member (Technology and Innovation) Mr Duncan Chiu), Robert (Hong Kong Digital Asset leader of Deloitte China, Mr Robert Lui), friends from the digital asset sector, ladies and gentlemen,
 
     The Forum today is very timely, as we are standing at a pivotal moment when economies worldwide are striving to chart the course for digital assets and oversight of their use. Hong Kong has been working diligently to stay ahead of the curve in building an ecosystem for the healthy development of the digital asset sector.
 
     As you know, back in 2022, we announced our first policy statement on digital assets, or virtual assets at the time, setting out our vision to create that comprehensive ecosystem under the principle of "same activity, same risks, same regulation". Then in June 2023, we put in place a licensing regime for digital asset trading platforms. Now we have a total of 11 licensees with local and international backgrounds. Nine exchange-traded funds with digital underlying assets have also been listed. In May this year, with the support of the Legislative Council, we enacted the Stablecoins Ordinance, making Hong Kong one of the few economies in the world to have a comprehensive law in place on stablecoin issuance. The Ordinance is scheduled to come into effect on August 1, and the Hong Kong Monetary Authority will begin to accept licence applications.
 
     This solid groundwork serves as a springboard for the next phase of digital asset development in Hong Kong. The "LEAP" framework or metaphor embodied in the second policy statement issued on June 26 conveys a proactive and forward-looking approach. To recap, "L" stands for legal and regulatory streamlining, "E" for expanding the suite of tokenised products, "A" for advancing use cases and cross-sectoral collaboration, and "P" is people and partnership development. These are linked to Hong Kong's unique advantages as an international financial centre, including our comprehensive legal system, sophisticated financial market and infrastructure, close connection with the international markets, and a wealth of professional talents.
 
     A lot of you are interested in the application scenarios or the "E" and "A" in the statement. A lot can be said on this. For now, I believe that as a well-developed financial market with a wide range of financial instruments and assets available for trading, Hong Kong has great potential to promote tokenisation of RWA (Real-World Assets). For example, Hong Kong is in a very good position to develop tokenised government bonds, building on our two landmark tokenised government green bond issuances in the past two years and Hong Kong's status as a leading bond issuance hub in Asia. The first batch totalling HK$800 million issued in 2023 was the first tokenised green bond issued by a government entity. The second batch, issued in 2024 denominated in Renminbi, Hong Kong dollars, Euro and US dollars and totalling close to HK$6 billion equivalent, was the world's first multi-currency digitally native green bonds. As announced in the 2025-26 Budget, the Government will regularise the issuance of tokenised bonds.
 
     I am sure that there are many good ideas about RWA out there in the marketplace. To encourage market participation in developing use cases, thanks to Cyberport, a funding scheme has been launched to support the development of high-impact applications with potential to serve as future use case benchmark.
 
     On the legal regulatory front or "L", right on the next day following the promulgation of the second policy statement, we launched a public consultation on the licensing regimes for digital asset dealing and custodian service providers. This is another big step in making the regulatory regime comprehensive, thus enabling us to manage the risks and harness the potential in different activities along the digital asset value chain, from issuance, trading and dealing, to post-trade custodian service. The two-month consultation period will end in late August. Do let us have your views.
 
     On the people and partnership front or "P", we value stakeholder engagement, and we walk the talk. At the policy level, the Financial Secretary is chairing the Task Force on Promoting Web3 Development. At the regulator level, the Securities and Futures Commission has established a consultative panel focusing on market and regulatory issues. The panel just held its second meeting yesterday. Fora like the one today will certainly provide useful feedback for our work.
 
     Our policy stance on digital assets is clear. We strive to embrace financial innovations so as to capture their potential benefits, but at the same time we need to put in risk management guardrails with emphasis on investor protection and user education. With this, we look forward to hearing your feedback, and I wish you fruitful discussions. Thank you.

Ends/Tuesday, July 8, 2025
Issued at HKT 18:40

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