The Hong Kong Special Administrative Region (SAR) Government has unveiled its latest strategic blueprint for digital asset development, reinforcing its ambition to establish the city as a global hub for digital finance and innovation. Dubbed the "Hong Kong Policy Declaration on Development of Digital Assets 2.0," this document introduces the "LEAP" framework and outlines a clear, actionable roadmap for businesses and investors.
Core Pillars of the LEAP Framework
The LEAP framework is built on four key strategic pillars designed to foster a secure, innovative, and vibrant digital asset ecosystem.
Legal and Regulatory Streamlining
A robust and adaptive regulatory structure is fundamental. The government, alongside the Securities and Futures Commission (SFC), is committed to refining the licensing regimes for Virtual Asset Service Providers (VASPs) and digital asset custodians. A comprehensive review of existing laws will be conducted to streamline processes for tokenized bond issuance and trading, covering settlement, registration, and record-keeping requirements.
Expanding the Suite of Tokenised Products
To drive mainstream adoption, the government will regularize the issuance of tokenized government bonds. This initiative is intended to incentivize the tokenization of real-world assets (RWA). Clarifications on stamp duty arrangements for tokenized exchange-traded funds (ETFs) aim to enhance their liquidity and accessibility. The government also encourages the secondary trading of these products on licensed digital asset trading platforms.
The application of tokenization technology will be promoted across various sectors, including precious metals like gold, base metals, and renewable energy assets such as solar panels. This demonstrates the versatile utility of blockchain beyond traditional finance.
Advancing Use Cases and Cross-Sectoral Collaboration
Fostering practical application is crucial. A new Blockchain and Digital Asset Pilot Grant Scheme will provide funding for projects with significant future potential and impact. The government is also strengthening collaboration between regulators, law enforcement, and technology providers to develop resilient digital asset infrastructure. In a show of leadership, the government is inviting market participants to propose pilot use cases for licensed stablecoins.
People and Partnership Development
Building a sustainable talent pipeline is a long-term priority. The government plans to collaborate with industry and academia to position Hong Kong as a center of excellence for knowledge sharing and international cooperation in digital assets. This includes supporting joint research initiatives and global regulatory coordination to cultivate a new generation of entrepreneurs, researchers, and technical experts. Explore more strategies
Government and Industry Endorsement
Senior officials have strongly endorsed the declaration. Financial Secretary Paul Chan noted that digital assets are a vital and promising component of fintech, enabling more efficient, lower-cost financial transactions through blockchain technology. He stated that the declaration demonstrates the government's vision and commitment to building a thriving digital asset ecosystem integrated with the real economy.
Christopher Hui, Secretary for Financial Services and the Treasury, highlighted Hong Kong's unique advantages in leading traditional finance into the digital asset era. He believes the LEAP framework will help build a trusted, sustainable, and deeply integrated digital asset ecosystem.
Positive Reception from Industry Stakeholders
The policy declaration has been met with widespread approval from legislators and industry leaders.
Legislative Council Member Duncan Chiu welcomed the proactive and open approach taken by the government, noting that the clear policy vision and direction will significantly aid Hong Kong's development as a Web3 international hub. He urged the government to move quickly to implement the outlined measures.
Fellow Legislator Johnny Ng highlighted the strategic shift in terminology from "virtual assets" to "digital assets," aligning with international standards and underscoring Hong Kong's innovative leadership. He pointed to the clear targets, defined divisions of labor, and tangible support—such as reducing operational costs and improving market liquidity—as reasons Hong Kong is poised to become a benchmark for compliant digital asset innovation in Asia within three to five years.
Major industry players also voiced their support. Hong Kong Cyberport, a leading digital community, welcomed the clear policy guidance and improved regulatory framework. It affirmed its role in supporting startups through business matching, technical support, and talent development.
OSL, a licensed digital asset financial services group, manages a significant portion of Hong Kong's digital asset ETF market. CEO Hugh Madden remarked that the terminological shift signifies the industry's maturation. He stated, "We are witnessing a global tokenized financial revolution that is transforming the efficiency of financial transactions and payments, and Hong Kong is positioned to be a standard-bearer in this revolution."
HashKey Tokenisation, a compliant tokenization service institution, also welcomed the declaration. CEO Anna Liu noted that the explicit support for tokenizing government bonds, money market funds (MMF), and real-world assets is deeply aligned with their business direction. View real-time tools
A Grounded and Strategic Vision
Dr. Zheng Lei, Chief Economist at Samoyed Cloud Technology Group, emphasized that the new policy is a solid and ambitious declaration rather than an abstract concept. He pointed out that the完善 (improvement) of the regulatory framework lays a solid foundation for the digital asset market, supportive tax policies inject vitality, and the construction of technical infrastructure provides strong safeguards for asset tokenization.
This comprehensive approach signals Hong Kong's serious intent to be at the forefront of the digital transformation of finance.
Frequently Asked Questions
What is the LEAP framework?
The LEAP framework is a strategic plan outlined by the Hong Kong government to develop its digital asset sector. It focuses on four areas: streamlining regulations, expanding tokenized products, advancing real-world use cases, and developing talent and partnerships to create a trusted and innovative ecosystem.
How will tokenization be encouraged?
The government will regularize the issuance of tokenized bonds and clarify tax arrangements for tokenized ETFs to improve their appeal and liquidity. It also actively promotes the application of tokenization technology across various asset classes and industries.
What does the new policy mean for investors?
The policy provides a clearer regulatory roadmap, enhancing market confidence. It aims to create a more robust and diverse market with innovative tokenized products, offering investors new opportunities while prioritizing risk management and investor protection.
When will the stablecoin licensing regime begin?
The licensing regime for stablecoin issuers is scheduled to be implemented as planned on August 1.
How is Hong Kong addressing the need for skilled professionals?
The government is collaborating with industry and academic institutions to foster talent development through joint research, knowledge sharing, and international cooperation, aiming to build a sustainable talent pool for the future.
What is the significance of the term 'digital assets' over 'virtual assets'?
The shift in terminology aligns Hong Kong with international standards and reflects a broader, more mature understanding of the asset class, emphasizing its legitimacy and integration into the formal financial system.