The Hong Kong government has taken a bold step forward in cementing its position as a global leader in digital innovation with the release of the Hong Kong Digital Asset Development Policy Declaration 2.0 on June 26. This comprehensive update reaffirms the city’s vision to build a trusted, innovation-driven digital asset ecosystem—prioritizing risk management, investor protection, and tangible benefits for the real economy and financial markets.
Building on the foundation laid by the original 2022 policy statement, the new declaration introduces the "LEAP" framework, outlining four strategic focus areas: Legal and regulatory streamlining, Expanding the suite of tokenized products, Advancing use cases and cross-sectoral collaboration, and People and partnership development. Together, these pillars aim to create a sustainable, inclusive, and future-ready digital economy deeply integrated with traditional industries.
A Clear Vision for Trusted Innovation
At the heart of the Policy Declaration 2.0 is a dual commitment: fostering cutting-edge financial innovation while maintaining robust safeguards. Financial Secretary Paul Chan emphasized that the updated roadmap reflects the government’s long-term vision for digital assets—not as speculative tools, but as transformative technologies capable of driving real-world economic value.
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“The goal is not just technological adoption,” Chan stated, “but to demonstrate practical applications of tokenization across sectors—from finance to energy—and ensure they deliver measurable benefits to businesses and citizens alike.” By balancing prudent regulation with market-led innovation, Hong Kong aims to cultivate a dynamic digital asset ecosystem that supports both startups and institutional players.
Financial Services and the Treasury Bureau (FSTB) Secretary Christopher Hui added that the LEAP framework provides a clear, actionable blueprint for stakeholders. “We are positioning Hong Kong at the forefront of digital transformation,” he said. “This policy gives enterprises and investors confidence through transparency, stability, and forward-looking governance.”
Pillar 1: Legal and Regulatory Streamlining
One of the most critical components of the declaration is the push for a unified regulatory framework for digital asset service providers. The Securities and Futures Commission (SFC) will take the lead in regulating digital asset trading service providers and digital asset custody service providers, with public consultations expected soon.
This marks a significant step toward aligning oversight across platforms, stablecoin issuers, custodians, and other key players. Simultaneously, the FSTB and the Hong Kong Monetary Authority (HKMA) are conducting a comprehensive legal review to facilitate the tokenization of real-world assets (RWA) and financial instruments.
The review will examine processes such as settlement, registration, and record-keeping for tokenized bonds, aiming to remove legal bottlenecks and create a seamless environment for on-chain transactions. These efforts signal Hong Kong’s intent to become a jurisdiction where blockchain-based finance can operate securely, transparently, and at scale.
Pillar 2: Expanding the Suite of Tokenized Products
To boost liquidity and market participation, the government will routinize the issuance of tokenized government bonds, building on successful pilot programs. Additionally, incentives will be introduced to encourage the tokenization of real-world assets—such as real estate, infrastructure, and commodities—by clarifying tax treatments, including stamp duty rules for tokenized exchange-traded funds (ETFs).
This opens the door for tokenized ETFs to be traded on licensed digital asset platforms, increasing accessibility and secondary market activity. Beyond finance, the policy highlights use cases in sectors like precious metals (e.g., gold), industrial metals, and renewable energy—where solar panel ownership could be fractionalized via blockchain.
Such initiatives not only democratize access to high-value assets but also enhance price discovery, reduce transaction costs, and improve capital efficiency across industries.
Pillar 3: Advancing Use Cases and Cross-Sector Collaboration
Starting August 1, a licensing regime for stablecoin issuers will come into effect—paving the way for broader adoption in payments, remittances, and decentralized finance (DeFi). This move strengthens Hong Kong’s infrastructure for digital transactions while ensuring issuer accountability and reserve transparency.
To accelerate innovation, the government encourages collaboration among regulators, law enforcement, and technology providers. It also invites market participants to submit proposals on how licensed stablecoins can be used in public-sector pilots—demonstrating leadership by example.
Cyberport, a major tech incubator, will launch a Blockchain and Digital Asset Pilot Funding Scheme, offering financial support to high-impact projects with strong market potential. Priority will be given to initiatives that showcase scalability, security, and cross-industry applicability.
Pillar 4: People and Partnership Development
Recognizing that talent drives innovation, the government is committed to building a sustainable pipeline of blockchain developers, entrepreneurs, researchers, and compliance experts. Partnerships with academia and industry will foster education programs, joint research projects, and international knowledge exchange.
Hong Kong also aims to become a global hub for regulatory dialogue, promoting cooperation on standards, anti-money laundering (AML) practices, and cross-border frameworks. By hosting international forums and pilot collaborations, it seeks to shape global norms in digital finance.
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Frequently Asked Questions (FAQ)
Q: What is the Hong Kong Digital Asset Development Policy Declaration 2.0?
A: It’s an updated government strategy released in June 2025 that outlines Hong Kong’s roadmap for becoming a global leader in digital assets through four key pillars: regulation, product expansion, real-world applications, and talent development.
Q: What does the “LEAP” framework stand for?
A: LEAP stands for Legal and regulatory streamlining, Expanding tokenized products, Advancing use cases, and People and partnership development—a structured approach to building a resilient digital asset ecosystem.
Q: When will stablecoin regulation take effect in Hong Kong?
A: The licensing regime for stablecoin issuers is set to begin on August 1, 2025, under the oversight of the Financial Services and the Treasury Bureau and the HKMA.
Q: Will tokenized ETFs be allowed in Hong Kong?
A: Yes. The government supports secondary market trading of tokenized ETFs via licensed digital asset platforms and is clarifying tax rules to encourage broader adoption.
Q: How is Hong Kong supporting blockchain startups?
A: Through initiatives like Cyberport’s Blockchain Pilot Funding Scheme, which provides grants to innovative projects with strong market potential and real-world application.
Q: Is Hong Kong focusing only on financial assets?
A: No. While financial instruments are a priority, the policy actively promotes tokenization of non-financial assets such as gold, solar panels, real estate, and other physical assets.
By integrating forward-thinking regulation with practical innovation incentives, Hong Kong is positioning itself not just as a financial gateway—but as a living lab for the future of digital finance.
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