Hong Kong Lawmaker Pitches City as Crypto's Neutral Ground Amid US-China Tech Rivalry

As crypto regulation splinters along geopolitical fault lines, Hong Kong legislator Johnny Ng is betting the city's future lies in refusing to pick a side.

In recent remarks, the Web3 advocate, who represents the tech sector in Hong Kong's parliament, outlined a vision that's less about winning the crypto race and more about building the track that everyone runs on.

"Crypto cannot be easily divided by country or economy. It is one world," Ng said in an interview with Coindesk.

It's a pragmatic read of the current landscape. With Washington tightening enforcement, Beijing maintaining its ban, and Singapore, Dubai, and the EU all carving out their own frameworks, the industry faces a patchwork of incompatible rules. Ng's pitch: Hong Kong's common law system, open capital flows, and established financial plumbing make it the natural venue for cross-border crypto activity that doesn't fit neatly into any single jurisdiction.

The Shenzhen Factor

What makes Ng's framing interesting is the Greater Bay Area angle. While most crypto hub narratives focus on attracting talent and capital away from competitors, Ng is explicit about leveraging mainland China's resources without trying to replicate them.

Shenzhen has the engineers — a young workforce, average age under 30, with deep hardware and software capabilities. Hong Kong has the legal structure and market access. Ng sees the combination as complementary rather than competitive.

"We can think something, and then we realize something by their human capital," he said.

It's a notable contrast to the zero-sum framing that dominated crypto geography debates in 2023-2024, when jurisdictions competed to poach exchanges fleeing US enforcement.

What's Coming

On the regulatory pipeline: custody and OTC frameworks are expected this year, alongside potential changes for professional investor trading volumes. Ng also flagged AI as a convergence point, arguing Hong Kong can work with both Western and Chinese datasets — a capability increasingly rare as tech decoupling accelerates.

Separately, Hong Kong Monetary Authority (HKMA) chief executive Eddie Yue stated that the HKMA has received stablecoin license applications from 36 institutions in the first round and is currently conducting ongoing evaluations, aiming to make decisions as soon as possible and issue the first batch of licenses in March.

Yue noted that the regulatory authority has requested additional information from some applicants. Submissions in the first round mostly contain basic information required for licensing, and further verification will focus on key elements such as specific use cases, risk management arrangements, and reserve asset composition.

HKMA aims to complete the issuance of the first batch of licenses in March but emphasized that the number of initial licenses will be limited, with progress guided by the principle of prudence and stability, Reuters reported on Monday.

The subtext is clear: in a fragmenting world, neutrality has value. Whether Hong Kong can actually deliver on that promise, given its political complexities, remains the open question.