As a seasoned analyst with extensive experience in global finance and tech markets, I find Hong Kong’s recent moves towards embracing digital assets, AI technology, and creating a comprehensive regulatory framework for these sectors nothing short of visionary. Having witnessed the rapid evolution of the tech industry and its profound impact on traditional finance, it is clear that Hong Kong is positioning itself to be a leading player in the digital age.
Regulatory bodies in Hong Kong are contemplating expanding tax incentives to cover digital assets such as cryptocurrencies, along with the integration of artificial intelligence technology within the financial industry.
Based on a Bloomberg report dated October 28th, Hong Kong’s financial secretary, Christopher Hui, stated that local regulators are considering extending current tax exemptions to facilitate investments in digital assets.
In simpler terms, if you’re a citizen of Hong Kong with cryptocurrency investments, there could be a decrease in taxes you owe in the coming months. Hui mentioned that a proposal for such a tax reduction law is expected to be submitted as legislation by the end of this year.
He said the move is meant to show Hong Kong “further recognize its role for asset allocation.”
By the end of this year, the Hong Kong Securities and Futures Commission plans to release a definitive roster of cryptocurrency exchanges eligible for complete licensing, as announced by Eric Yip, executive director of intermediaries at the SFC.
By mid-2025, regulators intend to establish a consultative panel for licenses, allowing exchanges to collaborate effectively. Simultaneously, the city has plans to release a detailed regulatory blueprint covering over-the-counter crypto trading desks and custodians.
On the same date, Hong Kong Exchanges and Clearing Limited announced their intention to debut a Virtual Asset Index Series on November 15, 2024.
The Hong Kong index collection is designed to offer additional pricing benchmarks for Bitcoin and Ether, particularly for time zones within the Asia-Pacific region. This move is one step towards making Hong Kong a prominent “digital asset center” in Asia.
Through providing clear, trustworthy real-time performance indicators, our aim is to empower investors with the knowledge they need to make wise investment choices. This will not only foster growth within the digital asset market but also strengthen Hong Kong’s position as a global financial hub.
HKEX Chief Executive Officer, Bonnie Y. Chan
Additionally, the Hong Kong administration authorized various regulatory bodies to initiate policy-making processes related to artificial intelligence (AI) technology usage. This move is indicative of a vision where financial institutions and numerous other sectors in Hong Kong can eventually incorporate AI into their daily operations.
According to Hui, the financial sector in Hong Kong possesses the necessary elements to foster artificial intelligence (AI) growth, including substantial markets and abundant use cases.
At present, Hong Kong finds itself in a tricky situation due to the ongoing tech disputes between the United States and China. As a result of this tension, many residents in Hong Kong are unable to utilize some of the globe’s most widely-used AI services, which are predominantly American-made, such as OpenAI’s ChatGPT and Google’s Gemini.
Conversely, Hong Kong residents often struggle to utilize AI technology services from companies like Baidu Inc. and ByteDance Ltd., which are based in China. On the other hand, we’re seeing a growing trend of AI adoption in various business and financial sectors worldwide.
To tackle this issue, Hong Kong aims to create its own artificial intelligence (AI) technology. The Hong Kong University of Science and Technology is currently developing InvestLM, a customized large language model designed to fit local market regulations. Upon completion, this technology will be accessible for use within the financial sector in Hong Kong.
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2024-10-28 10:41