Hong Kong is ‘poised’ to make it big on crypto’s next bull run: Hashkey Capital.

Hong Kong is “very poised” for the next wave of mass crypto adoption, with an influx of crypto talent pouring into the coveted digital asset hub, Hashkey Capital partner Jupiter Zeng said.

Speaking to Cointelegraph, a liquid fund partner and research partner at Hong Kong crypto firm HashKey Group – he explained that the combination of new Web3 projects with crypto-positive regulatory developments has led to significant growth in Hong Kong over the next four years. up to five years.

“You've got all these new, different projects here, with their founders and their teams, which by the way are all real homegrown. These groups are increasing banking and capital market activities.

Zeng added that while crypto prices may not reflect, the level of sophistication developing in the sector over the past 18 months has been impressive.

“The actual technological progress we saw throughout the bear market was amazing. So I think we are very ready for the next big mass adoption in the crypto world from the technology side, Zeng said.

The bullishness for the region was based on the belief that the economy in Hong Kong is in dire need of a new driver, which Zeng believes the crypto sector is ready to provide.

“GDP in Hong Kong has not looked good in recent years – mainly because of Covid. So it needs a new driver,” Zeng said. “So it's my theory that crypto and Web3 are the new drivers.”

@mar2424 Jupiter Zeng, Liquid Funds & Research Partner at Hashkey Capital, spoke at a panel discussion at CVCF last week on the theme “Navigating the Web3 Investment Landscape: Emerging Trends in 2023–24”. pic.twitter.com/P5Yg1Stzfi

— HashKey Capital (@HashKey_Capital) November 6, 2023

On August 3 of this year, Hashkey became the first crypto exchange in Hong Kong to receive a separate license allowing them to offer crypto assets to retail investors.

Although Zeng is not directly involved in Hashqi's exchange arm, he acknowledged that local Hong Kong interest in crypto products will grow as the government continues to raise investor concerns by outlining its regulatory plans for the sector.

“Recent policy changes provide security to retail investors as they now have insurance and legal protection,” he said.

“You don't need to use an online wallet to protect yourself. All you need to do is open an account on the exchange and then you can use your Hong Kong dollars to buy bitcoins and other cryptocurrencies. It's very simple.”

“For now, it's still a bear market, but when the bull market comes back, we can imagine that people's attitudes will change quickly. Retail will certainly come back, especially with more opportunities to shop safely through licensed exchanges.

Overall, Zeng predicts that Web3 in Asia and Hong Kong will witness a similar growth pattern to Southeast Asia's GameFi sector in 2021, with Axi Infinity quickly becoming one of the most played games in the world.

In Zeng's view, while Axi is exposed to huge speculations, the basic growth model will remain the same – projects built in the US and Europe can easily find a welcome market in Asia.

“I think Asia will continue to follow the same pattern in the future. Protocols and infrastructure projects developed in the United States or Europe or Australia may not be widely adopted where they are built – but if you want to find a market, you can go to Asia.”

Related: Swiss Crypto Bank SEBA Receives Hong Kong SFC License

Zeng admits there will be less of a fever than once seen in Southeast Asia, with a focus on scale and regulation of protocols and blockchain infrastructure rather than widespread speculation on the game.

Hong Kong's evolving virtual property policy is paving the way for a future #Web3.

Our liquid fund and research partner @mar2424 shares his insights on the developments and opportunities shaping the industry and the rest of the world at large.

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— HashKey Capital (@HashKey_Capital) November 7, 2023

Hong Kong was rocked by a crypto exchange scandal in September, when an unauthorized exchange called JPEX was accused of defrauding investors out of $165 million. The collapse has been described as one of the worst financial crises in the region.

Despite the controversy, Hong Kong's Financial Services Secretary and Treasurer Christian Hugh assured a gathering of investors, government officials and other regulators at HK Fintech Week that the JPEX drama has not affected the government's desire to transform Hong Kong into Asia's crypto hub.

Hong Kong has promised to strengthen its crypto regulations after the JPEX action. In addition, the SFC established a task force with the police to deal with illegal crypto exchange activities and updated its policies on crypto sales and requirements.

Asia Express: China's police against Web3, blockchain centralization continues.