According to cointelegraph, a Hong Kong government-backed study pointed out that decentralized finance (DeFi) and metaverse technology will become new opportunities to enhance the region's global financial technology competitiveness. The Hong Kong Institute of Monetary and Financial Research (HKIMR), the research arm of the Hong Kong Institute of Finance (AoF), released two reports on June 25, detailing the impact of DeFi and the metaverse on the financial industry.
The report shows that the DeFi market has grown from a market value of $6 billion in 2021 to more than $80 billion in 2023, demonstrating its huge potential. However, DeFi is still an untapped market, with more than 70% of crypto companies not yet involved in this field. Despite issues such as governance, compliance, and vulnerabilities, the research remains optimistic about the unique characteristics of DeFi and believes that it is expected to provide new financial services such as liquid staking, flash loans, and automated market makers.
In terms of the Metaverse, although local financial institutions have shown a high level of interest in it, actual participation is still relatively mild. More than 51% of respondents are skeptical about the future potential of the Metaverse, but some Hong Kong fintech companies are already actively promoting related developments.
“Emerging technologies such as DeFi and the Metaverse, which are closely related to the broader development of virtual assets and Web3, may bring various opportunities to Hong Kong’s financial services industry,” said David Fung, president of the Hong Kong Institute of Finance and executive director of HKIMR.
