The Vice-President of HKUST Criticizes Hong Kong’s Virtual Asset Licensing System
The Vice-President of The Hong Kong University of Science and Technology (HKUST), Wang Yang, recently expressed his dissatisfaction with Hong Kong’s current approach to regulating virtual assets. He believes that the existing licensing system is not only burdensome but also counterproductive, leading to significant losses for licensed exchanges like OSL. Yang coined the term “Licensed to Be Killed” to describe the predicament faced by these exchanges.
Hong Kong Urged to Build a Robust Web3 Ecosystem
Yang emphasized the importance of shifting focus from compliance and licensing towards building a robust Web3 ecosystem in Hong Kong. He proposed integrating virtual and real-world assets through blockchain technology. To achieve this, he suggested establishing a new public blockchain for real-world assets (RWAs) in Hong Kong, complete with an embedded Know Your Customer (KYC) mechanism.
Promoting a Conducive Regulatory Environment for RWAs
Yang’s criticism highlights the need for a regulatory environment that supports real-world assets. He believes that such assets can provide legitimate participants with prosperous opportunities, rather than becoming victims of a flawed system. By taking action on Yang’s suggestions, Hong Kong can redefine its role in the global development of Web3.
Hong Kong’s Crypto Industry Challenges
Hong Kong has witnessed significant activity in the crypto industry. The HKMA is already working on two Central Bank Digital Currency (CBDC) projects. However, there have also been instances of crypto scams and fraud, including the JPEX rug pull that cost users $178 million and an increase in phishing attempts impersonating major platforms like Binance.
Hot Take: Enhancing Hong Kong’s Virtual Asset Regulation
Hong Kong’s current licensing system for virtual assets has faced criticism from Wang Yang, the Vice-President of HKUST. Yang suggests that the system is burdensome and counterproductive, leading to significant losses for licensed exchanges. To address these issues, Yang advocates for building a robust Web3 ecosystem and integrating virtual and real-world assets through blockchain technology. He proposes the establishment of a new public blockchain with an embedded KYC mechanism for real-world assets in Hong Kong. This call to action aims to create a conducive regulatory environment that supports legitimate participants and redefines Hong Kong’s role in the global Web3 development landscape. However, Hong Kong also faces challenges in its crypto industry, including scams and fraud cases.
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