Hong Kong lawmakers have proposed that a stablecoin version of the digital Hong Kong dollar be developed by the government and linked to decentralized finance (DeFi) platforms, according to a report by WU blockchain.
Chain news published an interview with Wu Jiezhuang, a member of the Chinese People’s Political Consultative Conference’s National Committee and the Hong Kong Legislative Council, yesterday.
Previously, Startup accelerator G-Rocket announced plans to help 1,000 Web3 startups establish offices in Hong Kong in the next three years.
The company, co-founded by Hong Kong Legislative Council member Wu Jiezhuang, aims to bring together Web3 companies from around the world interested in developing in Asia and starting in Hong Kong.
Wu Jiezhuang suggested in his interview with Lianxin that Hong Kong could establish a virtual asset rating agency, develop the digital HK dollar as a stable currency option, and regulate against hacker theft to gain investors’ trust in the Web3 industry.
G-Rocket has encountered a growing number of Web3 entrepreneurial projects in the past year. However, the report claimed that there has been an increase in Web3 entrepreneurs entering Hong Kong following the release of the “Policy Declaration on the Development of Virtual Assets in Hong Kong.”
The Digital HK Dollar Into A Stablecoin
Lianxin and Wu Jiezhuang discussed about the potential for the entrepreneurial accelerator G-Rocket to support the development of the Web3 industry.
Wu Jiezhuang emphasized that Hong Kong, as an international financial center with comprehensive financial supervision, provides a good environment for the development of Web3 virtual asset exchanges.
In addition to serving as a trading platform, these exchanges could also potentially develop decentralized asset management. Lianxin mentioned the Hong Kong Prospect Declaration for the Development of Virtual Assets, which includes three experimental plans, one of which is the digital Hong Kong dollar.
Wu Jiezhuang suggested that this digital currency could be used as a stable currency option to effectively target the risks of Web3 virtual assets.
Lianxin asked Wu Jiezhuang for suggestions on decentralized virtual asset supervision, to which Wu Jiezhuang responded that the development of a digital Hong Kong dollar into a stable currency could be an effective way to mitigate risks associated with Web3 virtual assets.
He pointed out that currently available stablecoins are issued by private companies and are not subject to government supervision, which introduces risks. He mentioned the stablecoin thunderstorm that occurred earlier this year, which may have damaged confidence in stablecoins.
As a result, he proposed that the Hong Kong government consider issuing digital Hong Kong dollars and linking them to decentralized finance as a way to create an important infrastructure component for virtual asset trading platforms.
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