KEY POINTS
The Hong Kong government is now turning its attention to decentralized finance (DeFi) and metaverse technologies to enhance its role in the global FinTech arena.
The Hong Kong Institute for Monetary and Financial Research (HKIMR) has published two reports, one on DeFi and the other on the metaverse, detailing the potential and challenges of these emerging fields.
The report on DeFi emphasizes its growing importance compared to traditional finance. It outlines the opportunities and risks DeFi presents and suggests ways to support its development in Hong Kong.
Recommendations include exploring and facilitating the development of centralized finance (CeFi) and DeFi infrastructures as a hybrid model, promoting blockchain-related talent development, and enhancing public-private dialogue and collaboration.
Similarly, the metaverse report analyzes the challenges and opportunities provided by virtual reality technologies. It reveals that over 90% of financial institutions in Hong Kong have some knowledge of the metaverse, with 65% involved in its adoption — ranging from discussion and planning to implementation.
The report suggests several strategies to spread metaverse knowledge and adoption in Hong Kong. These include nurturing talent and fostering innovative entrepreneurship, promoting collaboration with stakeholders and other jurisdictions, adapting relevant frameworks, and establishing well-defined corporate governance structures for metaverse adoption.
Even though these reports boldly highlight Hong Kong’s interest in emerging technologies, the region has already been active in adopting these innovations, as has China.
Last year, China’s Ministry of Industry and Information Technology (MIIT) unveiled a three-year action plan to drive metaverse innovation across industries, emphasizing security and technological advancements.
In January of this year, China’s MIIT announced a partnership with industry leaders such as Huawei, Lenovo, Tencent, and others, forming a strategic alliance to advance the “Yuanverse” metaverse expansion, fostering innovation and technological advancements across various sectors.
