HK Web3 Feastival Roundtable: Balancing Regulation and Innovation to Build a Sustainable Asian Digital Financial Ecosystem

ChainCatcher on-site report, Global FinTech Institute Dean Li Guoquan, Hong Kong Legislative Council Member (Tech Innovation Sector) Chiu Tak-kin, Hong Kong Digital Port Management Limited Chief Public Mission Officer Chen Siyuan, Japan Virtual Currency Exchange Association (JVCEA) & Japan Cryptocurrency Business Association Executive Director Ko Masaoshi jointly attended the HK Web3 Festival roundtable discussion, focusing on “Balancing Regulation and Innovation, Building a Sustainable Asian Digital Financial Ecosystem.”

Chiu Tak-kin stated that the legislative process has been fully advanced, and the next step is to see innovation-driven development, exploring how to create space for new products and business models while improving the regulatory framework. He cited the startup exemption mechanism in the U.S. legislation as an example, emphasizing that the soil for innovation is equally important. He also pointed out that Hong Kong’s stock market currently does not allow a market maker system, and liquidity provision rules in virtual asset trading will be discussed in legislation within the year. Regarding prediction markets, he personally believes that Hong Kong is not yet ready to open up.

Chen Siyuan introduced that Digital Port launched a blockchain and digital assets pilot subsidy program last year, involving nine projects, more than half of which involve RWA tokenization, aiming to promote projects from proof of concept to commercialization. He said that Digital Port has gathered over 300 Web3 companies from 19 countries and regions, and emphasized that trusted digital identity (KYC/AML compliance) is the foundation for scaling RWA and payment projects, while secondary market liquidity determines whether tokenized assets can become genuine market products.

Ko Masaoshi revealed that the Japanese Financial Services Agency (FSA) submitted a new bill to the National Diet on April 10, proposing to transfer regulation of crypto assets from the Financial Services Law to the Financial Instruments and Exchange Law, which means the government officially recognizes the investment nature of crypto assets—a major shift. He also pointed out that Japan previously saw over 200 companies relocate to Singapore and other places due to strict regulations, but recently, through adjustments to corporate tax policies and discussions on personal crypto tax reforms, companies are gradually returning.

Host Li Guoquan summarized that Asian jurisdictions are not in competition but are part of the same ecosystem. Excessive compliance costs may push high-quality institutions into the gray area. How to lower compliance barriers in regulatory dialogues and promote responsible innovation is a common challenge facing the Asian digital financial ecosystem.