A Hong Kong legislator is urging the special administrative region to consider adding Bitcoin to its national reserve as a means of enhancing financial security. Wu Jiexhuang, a member of Hong Kong’s Legislative Council, believes that the region can leverage China’s “one country, two systems” policy to explore the potential benefits of holding Bitcoin.
Exploring the Market Impact of Bitcoin ETFs
Jiexhuang suggests that Hong Kong study the market impact of US-based spot Bitcoin exchange-traded funds (ETFs), citing the examples of smaller nations like El Salvador and Bhutan, which have already integrated Bitcoin into their strategic reserves. He also notes that US President-elect Donald Trump’s proposal to make Bitcoin a strategic reserve asset could have significant implications for traditional markets.
China’s Role in Ensuring Hong Kong’s Financial Stability
According to Jiexhuang, Hong Kong’s authorities should utilize the “one country, two systems” policy to explore ways to increase the region’s Bitcoin holdings. He believes that holding Bitcoin as part of national reserves could mitigate disruptions caused by broader adoption in traditional markets, offering Hong Kong a first-mover advantage.
Regulatory Framework
The Financial Services and the Treasury Bureau of Hong Kong is set to formulate crypto regulations based on the “same business, same risks, same rules” philosophy. This approach aims to provide a clear framework for the development of the crypto industry in the region.
Global Implications
Jiexhuang notes that if major economic powers were to include Bitcoin in their strategic reserves, the value of Bitcoin would become more stable, leading to increased adoption and a potential decrease in the value of traditional assets. This, in turn, could result in a reduction of government fiscal reserves holding traditional assets.
Hong Kong’s Bitcoin Reserve Ambitions
Another Hong Kong Legislative Council member, Johnny Ng, has announced plans to collaborate with stakeholders to assess the feasibility of incorporating Bitcoin into the region’s financial reserves. Ng highlights the growing global awareness of Bitcoin and its increasing importance in the discourse on digital assets and traditional financial systems.
Source: Cointelegraph.com
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