Is China eyeing global crypto dominance via Hong Kong?

In light of the ongoing deadlock over the US debt ceiling, Bitcoin (BTC-USD) witnessed a rise of over 2% with investors eyeing China’s proactive moves in the crypto sphere. As of Tuesday, Bitcoin traded approximately at $27,500, marking an upswing of 0.8% within a week, while the global cryptocurrency market capitalization soared by 1.8% to reach $1.19 trillion.

Amidst the financial uncertainties in the US, the spotlight has now shifted to Hong Kong and China’s evolving crypto market. As investors keenly monitor the scenario, it’s anticipated that mainland Chinese institutions and Hong Kong’s retail investors could soon get the green light to trade cryptocurrencies via Hong Kong.

The Hong Kong Securities and Futures Commission is gearing up for a crucial briefing on Tuesday, intending to outline the findings from a retail participation consultation. A significant takeaway from the briefing is the expected initiation of a licensing system for virtual asset platforms starting from 1st June.

However, this ambitious move doesn’t come without its share of controversies. The tumultuous ride of the global crypto market in 2022 and the significant collapse of the FTX exchange cast a shadow of doubt over the plan. Despite this, China’s strategic crypto initiatives reflect its growing economic clout, potentially surpassing the US and cementing its position as a global crypto hub.