Hong Kong lawmaker Wu Jie has urged the city-state’s government to integrate Bitcoin into its budget reserves, a local media outlet reported.
The report found that Wu proposed that the Hong Kong Special Administrative Region (SAR) explore the inclusion of cryptocurrencies in its budget reserves and deploy foreign exchange funds to acquire and hold digital assets for the long term.
The lawmaker highlighted the global implications of major economies including Bitcoin in their reserves. Wu argued that Bitcoin’s limited supply could position it as a competitor to traditional assets while providing protection against inflation.
While acknowledging Bitcoin’s volatility, Wu recommended that governments and companies allocate only a small percentage of their reserves to the asset. He emphasized that strategic adoption could benefit financial systems without exposing them to unnecessary risks.
Furthermore, as “influential” countries adopt Bitcoin, its value will stabilize to an extent that leads to wider adoption worldwide. This shift could reduce reliance on traditional reserves such as gold and silver, as Bitcoin’s lower storage and transaction costs provide a practical advantage, he explained.
Wu also noted Bitcoin’s growing presence in the mainstream financial world, citing the Hong Kong Stock Exchange’s Bitcoin- and Ethereum-linked ETFs and the issuance of licenses for crypto trading platforms.
This discussion builds on a question from lawmaker Johnny Ng, who had asked the government to consider the integration of digital assets.
China recognizes Hong Kong’s crypto progress
Meanwhile, China’s central bank has recognized that Hong Kong has emerged as a leader in crypto regulation.
In its 2024 Financial Stability Report, the People’s Bank of China praised Hong Kong’s progress in managing and integrating digital assets.
According to authorities, Hong Kong has been actively investigating crypto licensing and categorizing virtual assets under securitized and non-securitized financial assets. This dual classification system ensures proper oversight and licensing of virtual asset trading platforms, especially security tokens.
In addition, institutions engaged in virtual asset transactions must obtain regulatory permits before commencing their activities. Additionally, major financial institutions such as HSBC and Standard Chartered must incorporate crypto asset exchanges into their routine customer supervision processes.
China’s recognition underlines the significant progress Hong Kong has made in regulatory developments. This year, Hong Kong prioritized regulating stablecoins and crypto exchanges, which helped cement its leadership in Asia’s digital asset ecosystem.
Wu Blockchain first reported the story.
