Shares of digital asset firm Hashkey Group start trading in Hong Kong today, following the firm’s IPO last week. The Chinese city has steadily embraced digital assets since 2022 as it tries to maintain its status as a global financial center.
Hong Kong has tentatively embraced cryptocurrencies and digital assets as a way to shore up its status as an international financial center. The city, alongside Singapore, was one of the first jurisdictions in Asia to set up a licensing regime for cryptocurrency exchanges. Eleven exchanges, including Hashkey’s, are currently licensed to operate in Hong Kong.
“Hong Kong has established one of Asia’s most clear and proactive regulatory frameworks for digital assets,” says Anna Liu, CEO of HashKey Tokenization, the group’s dedicated tokenization division. The Chinese city serves as a “strategic gateway,” linking “Eastern and Western markets” and “traditional finance with digital innovation.”
Measures like the stablecoin ordinance “provide the certainty that institutional capital requires,” Liu says. “This clearly transforms Hong Kong’s [crypto sector] from a speculative market into a predictable and compliant environment for serious builders and long-term investors.”
Hong Kong’s exploration of cryptocurrencies is in stark contrast to mainland China, which still bans trading of digital currencies. (The city’s governance system allows it to have separate policies and regulations from the rest of China). Crypto observers sometimes see Hong Kong’s embrace of digital currencies as a leading indicator of how Beijing might approach digital assets in the future.
While Liu didn’t share thoughts on China’s plans for digital assets, she noted that “regulatory clarity is good for the industry, so that we know which countries and regions we can do something in. It gives us more clarity on the boundaries and red lines.”
Yet crypto shares have performed poorly in the second half of the year. Circle shares have lost 70% of their value since their peak in June. Bullish and Gemini shares have lost over 30% and 60% respectively since their trading debuts in the late summer.
Cryptocurrencies too have fallen since their peak in October, with Bitcoin down about 30% and Ether down about 40%, amid broader jitters about geopolitical tensions, fears of an AI bubble, and hidden weaknesses in financial markets.
