Hong Kong promotes the gold tokenization revolution: John Lee announces the establishment of a 2,000-ton gold reserve hub within 3 years.

The Chief Executive of the Hong Kong Special Administrative Region, John Lee, announced in the latest Policy Address that Hong Kong will accelerate the establishment of an international gold trading market, promoting Hong Kong to become a regional gold reserve hub, and plans to increase gold storage to over 2000 tons within 3 years. At the same time, the government will enrich gold investment vehicles, assisting issuers in issuing gold funds and tokenization of gold investment products, further consolidating Hong Kong's status as an international financial center.

Hong Kong Gold Market Development Strategy Fully Launched

Lee Ka-chao stated that the government has accepted the recommendations of the "Task Force on Promoting the Development of the Gold Market," with the Financial Services and the Treasury Bureau responsible for implementing a series of measures, including:

1. Promote the Hong Kong Monetary Authority and financial institutions to expand gold storage in Hong Kong, with a target of exceeding 2,000 tons in 3 years.

2. Promote financial institutions to establish or expand refineries in Hong Kong, and collaborate with the mainland to research processing with materials supplied from the mainland.

3. Establish a Hong Kong Gold Central Clearing System to provide efficient and reliable clearing services for international standard gold transactions.

4. Invite the Shanghai Gold Exchange to participate and prepare for future interconnection with the mainland market.

5. Enrich investment vehicles for gold, assisting issuers in the issuance of gold funds and tokenization of gold investment products.

6. Support the establishment of a Gold Industry Association in the industry to create a communication platform with the government and regulatory agencies.

It is worth noting that the Shanghai Gold Exchange's international board has established its first overseas delivery warehouse in Hong Kong and launched a new contract for delivery in Hong Kong. Lee Ka-chao emphasized that the government will continue to promote cooperation in the Shanghai-Hong Kong gold market and strengthen Hong Kong's position as an international gold trading hub.

Gold Tokenization: The Fusion of Traditional Assets and Digital Finance

Lee Ka-chao emphasized the assistance in the issuance of tokenized gold investment products, marking an important integration of Hong Kong's traditional gold market with digital financial innovation. Gold tokenization will enable investors to participate in gold investment with lower thresholds and higher efficiency, while maintaining the value protection characteristics of gold as a physical asset.

Diversified Financial Development Strategy

In addition to the gold market, John Lee's policy address also covers multiple areas of financial development:

· Applications of Artificial Intelligence in the Financial Sector

Lee Ka-chao stated that the second phase of the AI sandbox program launched by the Monetary Authority and Cyberport will be promoted to more financial institutions. The Monetary Authority is establishing an AI model evaluation method to enhance the safety testing of the financial system. In addition, the Department of Justice will set up a cross-departmental working group to review the legal framework required for the broader application of AI.

· Support mainland enterprises to "go global"

The government will integrate Hong Kong's overseas offices to form a one-stop platform and establish a "Mainland Enterprises Going Global Task Force" to actively attract Mainland enterprises to use the Hong Kong platform to "go global." The Monetary Authority will promote the banking industry, especially Mainland banks, to establish regional headquarters in Hong Kong, leveraging Hong Kong's advantages to expand and develop markets in Southeast Asia and the Middle East.

The Hong Kong Monetary Authority and the Public Investment Fund of Saudi Arabia (PIF) have signed a memorandum of understanding to establish a new investment fund of up to $1 billion, aimed at helping companies from Hong Kong and other Greater Bay Area cities "go overseas" to Saudi Arabia.

Fintech and Digital Asset Development

Li Jiachao pointed out that the Monetary Authority will continue to promote the Ensemble project, including encouraging commercial banks to launch tokenization deposits and real tokenized asset trading, such as settling tokenized money market funds with tokenized deposits. The government is implementing a stablecoin issuer system and formulating legislative proposals for the licensing system of digital asset trading and custody services.