Hong Kong’s biggest licensed cryptocurrency exchange began trading on Wednesday, underscoring the city’s efforts to position itself as a global hub for digital assets, despite mainland China’s continued ban on cryptocurrency trading and mining.
While crypto activities remain prohibited in mainland China, Hong Kong has embraced the sector, with prominent advertising and a regulatory push aimed at staying ahead of rival financial centres such as Dubai and Singapore.
HashKey Group, founded in 2018, made its market debut after raising US$205 million in its initial public offering. Shares closed the morning session down 2.69% at HK$6.50 (US$0.84).
Speaking at the listing ceremony, HashKey CEO Xiao Feng described the debut as a “glorious day,” saying it demonstrated that compliance and innovation can go hand in hand.
“As entrepreneurs, we come from mainland China, but HashKey is a homegrown Hong Kong company,” Xiao said. “Even in the digital asset industry, a robust regulatory framework is essential.”
Hong Kong is increasingly viewed as a testing ground for cryptocurrency adoption within China’s broader financial ecosystem. Earlier this year, the city introduced a licensing regime for stablecoins, which are designed to be less volatile than traditional cryptocurrencies.
“China remains cautious about cryptocurrency use, so Hong Kong serves as a testing ground,” said Merton Lam, head of digital asset firm Crypto HK. He noted that while global platforms such as Binance are accessible, locally licensed exchanges like HashKey offer greater convenience and regulatory assurance for users converting cash into digital assets.
Legal experts say market conditions and policy support have both favoured HashKey’s launch. Etelka Bogardi, a fintech lawyer at Reed Smith, said Hong Kong’s proactive approach to regulation over the past year has created a more welcoming environment for blockchain innovation.
“In the last 12 to 18 months, Hong Kong has significantly advanced its regulatory clarity, making it a more facilitative jurisdiction for digital assets,” she told AFP.
