Hong Kong legislator Duncan Chiu: Hong Kong's cautious approach to cryptocurrency regulation will pay off

Duncan Chiu, a member of Hong Kong's Legislative Council and chairperson of the Committee on Technology and Innovation, which oversees the city's tech parks and research facilities, said Hong Kong's initial caution in regulating cryptocurrencies has brought advantages. "Sometimes, it's a good thing to be late because you have a clear picture," Chiu said in a recent interview. For example, he pointed to the swift adoption of rules for cryptocurrencies by the Monetary Authority of Singapore (MAS), Singapore's main financial regulator. The MAS initially regulated cryptocurrencies under its Payment Services Act, mistakenly treating them as instruments of payment rather than as an asset class. Japan initially did the same, forcing a 2024 revision as market behavior for cryptocurrencies changed as DeFi and tokenization gradually gained attention.
"Although Hong Kong started late, the good thing is that the usage patterns of these products are clearer," said Chiu, who is one of Hong Kong's most prominent cryptocurrency advocates, alongside Legislative Council member Johnny Ng. Chiu further pointed out that the original Bitcoin white paper labeled the asset class as electronic cash, while the market reality is that it has become a commodity - a view shared by the US Commodity Futures Trading Commission - another example of how cryptocurrency market behavior has evolved and requires regulatory adaptation.