By Curtis Dye
According to Wu Blockchain, a Chinese Twitter reporter, Hong Kong has campaigned for the digital Hong Kong dollar to be considered a government-issued stablecoin in terms of DeFI. He went on to remark that, with Beijing’s approval, Hong Kong is pushing the development of Web3.
Additionally, Paul Chan, the finance secretary of Hong Kong, has recognized the necessity for digital money. He believes that blockchain technology and cryptocurrencies may assist Hong Kong in becoming a worldwide center for financial technology and that Hong Kong should create its digital currency to make financial transactions easier.
HKMA researches Digital Currency
The Hong Kong Monetary Authority (HKMA) has created a Research Group on Financial Technologies to investigate the feasibility of introducing a digital currency. In addition, they are researching the present situation of digital currencies and how they may be employed in Hong Kong.
According to reports, the government is also looking into the prospect of developing a whole new digital currency using distributed ledger technology. This would make Hong Kong’s financial services sector a more competitive and efficient player on the global stage.
Also read:HKD Stability Reserve Plan
In addition, the government is investigating the possibility of putting in place a reserve mechanism in order to protect the authenticity of the digital Hong Kong dollar and prevent any potential financial losses.
On the other hand, the release of the Policy Declarations on the Development of Virtual Assets in Hong Kong has fostered a rise in Web3 business activity inside the city. This may be attributed to the declaration’s aim to develop virtual assets in Hong Kong.
In conclusion, the digital Hong Kong dollar is a feasible choice for use in the DeFi system in Hong Kong. The government is continually investigating and exploring different methods to ensure the currency’s safety, security, and dependability. How well-established and widely used virtual currencies become in Hong Kong remains an open question.
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