In its commitment to becoming a crypto and Web3 hub, a Hong Kong-based Fund is set to raise…
In its commitment to becoming a crypto and Web3 hub, a Hong Kong-based Fund is set to raise $100 million to support 80+ crypto firms that have indicated an interest in setting up a base in the Asian nation.
At the Aspen Digital Web3 Investment Summit on the 20th of March, the Hong Kong Secretary for Financial Services and the Treasury, Christopher Hui, stressed that the nation is “well-positioned” to be a “leading hub” for Web3 in Asia and beyond. In addition, he said that the region continues to give “great importance” to virtual assets [VAs] and Web3.
He said, “The government has a high-level commitment to developing the sector and providing a comprehensive support system to enterprises that are passionate pioneers and startups in this area.”
He stated that over 80 FinTech firms have indicated interest and supported it by offering different kinds of “innovative and convenient” financial services in Hong Kong. In lieu of VA-related numbers, he added,
“As of end-February 2023, Invest Hong Kong has received expressions of interest from over 80 virtual asset-related mainland and foreign companies in establishing their presence in Hong Kong.”
These firms included virtual asset exchanges, blockchain network security, and infrastructure providers. Virtual currency wallets, payment services, and other Web3 projects were also included on the list. Furthermore, the Financial Services and Treasury Secretary stated that 23 companies from the EU, the Mainland, Canada, Singapore, the United Kingdom, and the United States had indicated a desire to establish a presence in Hong Kong.
Why Crypto Startups are interested in setting up their base in Hong Kong
Beyond what is common in other regions, the regulators in Hong Kong are passive in their stance without letting their guard down on consumer protection. Due to these factors, the region has garnered interest from many firms ready to set up their base in Hong Kong. The flexibility, thoughtfulness, and dedication to consumer protection have created a blooming atmosphere in Hong Kong’s crypto sector.
As highlighted in Bloomberg’s recent report, the move to raise $100 million this year for crypto startups by a fund led by Ben Ng and Curt Shi proves why Hong Kong has been a flourishing spot for cryptocurrency.
The fund is a venture partner at the equity firm SAIF Partners. Reports claim it has secured at least $30 million in “funding commitments.” The fund has invested in six digital-asset projects, including Hong Kong-based metaverse company GigaSpace and Australia-based digital sports club One Future Football.
As a region committed to attaining its desired status as a digital asset hub, regulators are set to hold a meeting between crypto firms and bankers next month to improve financing for the sector. Additionally, the meetup aims to aid “direct dialog” and share “practical experiences and perspectives” in opening and maintaining bank accounts. Though there is an exciting streak of support for crypto in the region, there are fears that things could go south in the coming days.
Curt Shi said: “I understand the concerns, but nothing is perfect given the complexity of the crypto economy and currency geopolitical situation. Our strategy is to continue to see how things go.”
Regarding investor behaviour, Shi stated that investors have been cautious about deploying capital into new crypto projects, but fundraising has been “relatively smooth.” He added that many Hong Kong families interested in the digital economy had participated in the fundraising.
Shi added, “I believe that Hong Kong will continue to have a certain degree of openness and flexibility. While our portfolio and fund will embrace Hong Kong and its policies, we will continue to have a presence in Australia, Singapore, as well as in Europe and the US.”
He said, “The government has a high-level commitment to developing the sector and providing a comprehensive support system to enterprises that are passionate pioneers and startups in this area.”