During a recent workshop in Davos, Hong Kong’s Finance Secretary Paul Chan underscored the importance of regulatory frameworks that support innovation in the digital asset landscape.

Chan stated that, while finance and technology are increasingly interconnected, effective regulation is critical:

“Digital assets should serve the real economy. But we must also build strong guardrails to address risks to financial stability, market integrity, and investor protection.”

He highlighted the principle of “same activity, same risk, same regulation”, which governs the regulatory approach towards digital assets, ensuring that businesses are regulated based on their activities rather than the technologies they utilize.

Chan referenced existing initiatives aimed at providing a secure environment for virtual asset trading, including a licensing framework and pilot transactions with tokenized deposits carried out by the Hong Kong Monetary Authority (HKMA). Additionally, he indicated that licenses for stablecoins are expected to be rolled out soon, alongside the issuance of tokenized green bonds totaling $2.1 billion since the start of the year.

Hong Kong’s Emphasis on Tokenization

As a prominent player in the global crypto market, Hong Kong is increasingly exploring tokenization’s practical applications in the financial sector. Recent developments include a $3.8 billion money market fund tokenized by a subsidiary of China Merchants Bank on the BNB Chain.

The HKMA’s upcoming Fintech 2030 strategy aims to prioritize tokenization and data management, underscoring its commitment to advancing this sector.

In November 2025, significant steps were taken with a blockchain-based trade finance pilot project involving key stakeholders from Brazil and Hong Kong, further solidifying their economic cooperation.