Hong Kong Faces Challenges in Establishing Tokenized Capital Market

According to Foresight News, former Hong Kong Securities and Futures Commission Chairman, Leung Ding-bong, discussed the advancements in tokenized stock trading during an interview. He noted that the U.S. Nasdaq has begun experimenting with tokenized stock transactions, utilizing stablecoins like USDC for settlement. Leung emphasized that tokens are not a new concept, as stocks are essentially a form of token. By converting stocks into digital tokens on a blockchain, all operations can be completed within a single system, enabling instant settlement. Leung highlighted the potential for asset tokenization combined with central bank digital currencies to transform market operations. He pointed out that Hong Kong faces three major challenges in establishing a new capital market based on asset tokenization: technological infrastructure, regulatory framework, and market acceptance. Addressing these challenges is crucial for Hong Kong to develop a tokenized capital market.