Author: Lang Guangzhao

Wu Jiezhuang, member of the Hong Kong Legislative Council and chairman of the Web3 Virtual Asset Development Subcommittee, recently When interviewed by Hong Kong Wen Wei Po, he suggested that Hong Kong should make good use of the advantages of "one country, two systems" and "first try" to include Bitcoin in the assets of the Exchange Fund.

01 The United States actively promotes strategic reserves of Bitcoin

Bitcoin has experienced a surge in recent months During the bull market, the price once exceeded 100,000 US dollars. The biggest driving force was the support of the subsequent US President Trump for cryptocurrency. He claimed that after taking office as president, Bitcoin would be included in the strategic reserve.

Wu Jiezhuang said, "Some states in the United States have also enacted legislation requiring 10% of state reserves to be in Bitcoin, making asset allocation more diversified."

U.S. Texas Rep. Giovanni Caprellioni proposed a bill in December 2024 calling on the state to establish a Bitcoin reserve. “The Strategic Bitcoin Reserve is consistent with Texas’ commitment to promoting digital asset innovation and providing Texans with enhanced financial security,” the bill reads. The draft states that Texas must hold Bitcoin for at least five years and must keep it in cold storage. (a device that is not connected to the internet) and requires that these assets cannot be used for transactions outside of Texas.

The Pennsylvania House of Representatives introduced a bill in November 2024 calling for the establishment of a strategic Bitcoin reserve. Under the proposal, Pennsylvania’s treasurer would be able to use “up to 10%” of the state’s general fund, “rainy day fund” (fiscal stabilization fund) and state investment fund to purchase Bitcoin. Assuming that 10% of the state’s general fund is used, it means that the Pennsylvania Treasury Department can purchase nearly $1 billion worth of Bitcoin.

Ohio Rep. Derek Melling introduced a bill on December 17, 2024 to establish a strategic Bitcoin reserve in the state. The bill also gives the Ohio Treasurer discretion to purchase the property.

Wu Jiezhuang believes that if Trump vigorously promotes the inclusion of Bitcoin as a strategic reserve asset, he believes that it will have a significant impact on the global market, especially reserve assets. Countries Can't turn a blind eye.

Hong Kong Wen Wei Po reported: Asked about RuomeiThe country has designated Bitcoin as a strategic reserve asset. What impact will it have on the financial security of the mainland and Hong Kong? Wu Jiezhuang believes that the most likely opportunity is to shake the value of traditional assets. Bitcoin with a supply limit will become a tool to fight against excessive currency issuance and inflation. Artifact, some believe that Bitcoin can better preserve its value. “If major economic powers take the initiative to include Bitcoin in strategic reserves, the value of Bitcoin will be more stable, attracting more and more other countries to follow suit, and reduce the holding of traditional assets, which will increase the value of traditional assets. Falling prices will cause holders of traditional assets to Fiscal reserves have shrunk.”

02 It is recommended that Hong Kong include cryptocurrencies in fiscal reserves

So Wu Jie Zhuang raised a number of concerns with the SAR, including Whether it will consider incorporating digital assets and cryptocurrencies into fiscal reserves, and consider using the Exchange Fund to continue to purchase and hold them for a long time; and evaluate the impact of foreign countries’ designation of Bitcoin as a strategic reserve asset on the financial security of the mainland and Hong Kong; and how to use Hong Kong With first-mover advantages and unique resource conditions in the field of cryptocurrency, we can make strategic arrangements to contribute to maintaining financial security.

However, Wu Jiezhuang also pointed out that the risks of Bitcoin are not low. First, the price will rise and fall sharply. Second, we only know how many wallets there are in the market. , but it is not clear the identity of the holders behind these assets. After balancing risks and returns, he believes that businesses and businesses should only allocate a small portion of Bitcoin as financial assets.

03 The foundation of Hong Kong

Hong Kong will issue a declaration on the development of virtual assets from the end of October 2022 , the supervision, regulations, technologies and products related to virtual assets are becoming more and more abundant.

Currently, the number of licensed virtual asset platforms in Hong Kong has increased to 7, and a total of 12 ETFs linked to Bitcoin and Ethereum are trading on the Hong Kong Stock Exchange. The first three companies (and combinations of companies) are participating in the stablecoin "sandbox", and a number of tokenized bonds have been successfully issued in Hong Kong.

In terms of the speed of licensing, Hong Kong is relatively slower than Singapore, which is also committed to developing the virtual asset market. In 2024, Singapore issued 13 cryptocurrency licenses.

In the "Financial Stability Report 2024" released by the Central Bank on December 26, 2024, the supervision of cryptocurrency in Hong Kong was explained as follows:

Hong Kong is actively exploring crypto asset license management. Hong Kong will virtual assetsIt is divided into two categories for supervision, namely securitized financial assets and non-securitized financial assets. A special "dual license" system is implemented for virtual asset trading platform operators, that is, "security tokens" are applicable to the supervision of the Securities and Futures Ordinance. and license system. "Non-security tokens" are applicable to the supervision and license system of the "Regulations on Combating Money Laundering". Institutions engaged in virtual asset business must apply for a registration license from the relevant regulatory authorities before they can operate. At the same time, large financial institutions such as HSBC and Standard Chartered Bank are required to include crypto asset exchanges in their daily customer supervision.

Reference materials:

Hong Kong Wenhui Network: [Bitcoin Mania] Advocate for the Exchange Fund Nabitcoin responds to the United States disrupting traditional markets

Sina Finance Network: Many states in the United States are considering establishing strategic Bitcoin reserves