Hong Kong a unique proving ground for DeFi, metaverse, HKIMR studies show

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DeFi and metaverse will open up opportunities for the financial services industry, Hong Kong Institute for Monetary and Financial Research executive says

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Hong Kong is making a big push to become a virtual asset and Web3 hub. Photo: Shutterstock

Aileen Chuang

Published: 8:30am, 26 Jun 2024

Hong Kong possesses unique competitive advantages to develop decentralised finance (DeFi) and the metaverse as these blockchain technologies continue to evolve, according to two surveys by a government-backed body.

The city’s advantages, based on surveys on DeFi and the metaverse with financial institutions, include a well-defined legal and regulatory framework, business-friendly environment, robust financial infrastructure and network, and highly skilled talent.

The emerging DeFi and metaverse technologies “will likely present various opportunities for the financial services industry in Hong Kong”, said Enoch Fung, executive director of the Hong Kong Institute for Monetary and Financial Research (HKIMR), which is backed by the Hong Kong Monetary Authority.

As the city makes a big push to become a virtual asset and Web3 hub, the reports offer insights for market participants and regulators, locally and internationally, which will help form policy initiatives and market innovations, Fung said at a media briefing on Tuesday.

Enoch Fung (left), the executive director of Hong Kong Institute for Monetary and Financial Research, and Giorgio Valente, the head of HKIMR, hold copies of the DeFi and metaverse surveys on Tuesday. Photo: HKIMR

HKIMR coordinated with consultancy PwC to conduct the two surveys, studying organisations in the asset and wealth management, banking, insurance, virtual asset and metaverse service industries.