Starting early only to arrive late, this may be the most fitting description of Hong Kong’s development history in the crypto industry. In the early stages of the crypto industry, a series of companies with far-reaching impact were born here, including today’s stablecoin giant Tether, the former exchange leader FTX, the derivatives exchange BitMEX, and the well-known exchange Crypto.com. During that period, Hong Kong became one of the most important bases for global crypto startups.

But what is regrettable is that this former crypto startup center gradually lost its leading position in the industry in the following years. With changes in Hong Kong’s and international regulatory environment, a large number of crypto companies such as Tether and FTX left Hong Kong around 2021 and moved to Singapore, Dubai, the Bahamas and other places. Hong Kong missed out on the most frenzied growth dividends of the crypto market for a long time.

However, when the industry entered a new cycle, Hong Kong once again appeared on the core stage of the crypto market. In the past two years, from the implementation of the exchange licensing system to the promotion of the stablecoin regulatory framework, to the holding of a series of large-scale industry events, Hong Kong is re-attracting the gathering of funds, talents and enterprises, and gradually forming a new crypto industry structure.

In the early stages of the crypto industry, Hong Kong was almost one of the most important startup cities in the world. At that time, a large number of crypto companies chose to set up their headquarters teams here, and the reasons were not complicated: Hong Kong has a mature financial system, an international legal environment, and a relatively open capital flow mechanism. These conditions make it an important node connecting Asia and the global market, especially the Chinese-speaking market.

However, this advantage did not last long. As the global regulatory environment became stricter, Hong Kong adopted a more cautious regulatory strategy in the field of virtual assets. The Hong Kong Securities and Futures Commission gradually established a licensing system for virtual asset trading platforms after 2018, and put forward strict compliance requirements for exchanges, including investor restrictions, fund custody and operating norms. In the eyes of the crypto industry, which was still in a highly barbaric growth stage at the time, the threshold of this system was too high and would restrict its access to overseas users. Only 10 local small and medium-sized exchanges with traditional financial backgrounds obtained exchange licenses in five years.

Many large cryptocurrency exchanges chose to leave Hong Kong and move to jurisdictions with more relaxed regulations. FTX moved its headquarters to the Bahamas in 2021, and some trading platforms turned to Singapore or Dubai. With the departure of these companies, Hong Kong gradually changed from one of the core cities for crypto startups to a relatively marginal participant. Hong Kong’s local track also failed to form support. Animoca Brands relied on NFTs and GameFi to become the most representative crypto company in Hong Kong. It was once regarded as Hong Kong’s Web3 business card, and established a huge ecosystem covering hundreds of projects through investment and incubation. However, with the collapse of NFT trading volume, the failure of the GameFi economic model, and the cooling of the financing market, Animoca’s growth logic quickly weakened, and its IPO has not been implemented for a long time, and its market influence has been significantly weakened. In addition, the closure or escape of Babel Finance, BitCoke, and JPEX has also had a negative impact on Hong Kong’s local crypto ecosystem and market education, leading to further tightening of relevant regulatory policies by regulatory authorities. When the industry’s most core infrastructure and community of interests are undergoing global restructuring, Hong Kong is still in a swing of “regulatory wait-and-see – tightening – re-adjustment”.

The turning point occurred in 2025. In May, Hong Kong passed the 《Stablecoin Ordinance Bill》 and officially took effect on August 1, aiming to establish a licensing system for stablecoin issuers. The ordinance requires stablecoin issuers in Hong Kong or claiming to be pegged to the Hong Kong dollar to be licensed, emphasizing sufficient asset reserves, segregation of client assets and prohibition of interest payments. In June, the Hong Kong government issued the 《Hong Kong Digital Asset Development Policy Declaration 2.0》, stating its firm commitment to building Hong Kong into a world-leading digital asset center, which also involves specific regulatory agencies, exploration directions, support policies, etc., which greatly boosted the confidence of practitioners in the digital asset field.

At the same time, Hong Kong’s main competitor, Singapore, issued new DTSP regulations in May 25, requiring all crypto service institutions to be licensed by the end of June, and the policy orientation of “very few licenses issued” led to the migration of a large number of enterprises. At this time, Hong Kong’s launch of the “LEAP” strategic framework – legal regulatory optimization, expansion of tokenized products, promotion of application scenarios, and development of talent cooperation – has just formed a policy complement, attracting global crypto resources to gather in Hong Kong.

The crypto market conditions and trends are also further stimulating the entry of global forces. On the one hand, the price of Bitcoin continued to rise in 25 and created a new high in October. On the other hand, the popularity of concepts such as RWA and DAT also promoted the entry of global mainstream financial and technology companies such as BlackRock and Visa, which provided a good external environment for Hong Kong to vigorously promote the development of the crypto industry.

In today’s Hong Kong crypto market, the protagonist is no longer a broad and large hot project, but a local compliant enterprise cluster focusing on crypto asset management, stablecoins and payment fields. In the exchange track, Hashkey Group successfully completed a $200.00 million IPO and has become one of the most influential crypto companies in the Asian market with its coverage of trading, asset management, Layer 2, VC and other aspects. In the payment track, RedotPay has successively completed hundreds of millions of dollars in financing, becoming the biggest dark horse in the crypto payment field through its aggressive strategy in emerging regions. Avenir Group, First Digital, Hex Trust and other companies have also established solid market competitiveness.

In February 2026, eight ministries and commissions of the mainland jointly issued Document No. 42, which clearly prohibits RWA tokenization-related activities within the country, but at the same time opened up compliant channels for overseas RWAs, allowing domestic entities to carry out RWA business overseas on the premise of meeting regulatory conditions. The document also pointed out that overseas branches (branches, offices, etc.) of domestic financial institutions can carry out tokenization-related business, while complying with local laws and Chinese regulatory requirements, and fulfilling statutory obligations such as high prudence and anti-money laundering. Considering that most of the overseas branches of Chinese financial institutions are based in Hong Kong, this regulation has further established Hong Kong’s bridgehead position in the Chinese-speaking market, making Hong Kong a key hub connecting mainland regulation and the global market.

For the Chinese-speaking crypto market, Hong Kong’s value is irreplaceable. It is not only a “compliant springboard” for mainland crypto talents to go overseas, but also a “conversion interface” for global capital to absorb and enter the Chinese-speaking market, relying on its international financial center status to connect compliant crypto assets with global institutional investors. This two-way hub role makes Hong Kong occupy a unique “middle ground” in the global crypto industry, which is different from the dominant ecology of the United States and the grassroots innovation of Southeast Asia, forming a differentiated advantage with “compliance, connection, and pragmatism” as the core. In a sense, Hong Kong is becoming an “offshore experimental field” for China’s crypto industry. This positioning not only meets the development needs of the global digital asset industry, but also to a certain extent fits the core logic of mainland regulation. It is this delicate balance that allows Hong Kong to regain a unique position in the global crypto regulatory competition.

Hong Kong’s ten years in the crypto market is a ups and downs about “missing” and “grasping”. In the early stage, it missed the tuyere of barbaric growth due to the mismatch between the regulatory rhythm and the industry development; but when the industry entered the compliance era, Hong Kong took the initiative to step on the rhythm, and used a clear regulatory framework, unique geographical advantages, and a solid industrial ecology to show the outside world its firm confidence in the crypto industry. If the early Hong Kong was a gathering place for crypto entrepreneurs, then today’s Hong Kong is more like a prototype of a digital asset financial center. After gradually forming institutional advantages in stablecoin regulation, asset tokenization, and cross-border payment, this city may be ushering in its second chance. And this time, Hong Kong is no longer just a bystander in the crypto industry, but may become the core hub of the compliant crypto market in the Chinese-speaking world and even the entire Asia-Pacific region. [ChainCatcher]