Hong Kong regulators are considering extending tax breaks to include digital assets such as crypto and the use of artificial intelligence technology in financial sectors.
According to an October 28 Bloomberg report, Hong Kong Financial Services and Treasury Secretary Christopher Hui said that Hong Kong regulators have proposed extending tax relief laws to include digital asset investments.
The tax break means that Hong Kong citizens who own crypto investments may see tax relief in the near future. Hui said the tax reduction bill will be proposed as law by the end of this year.
He said the move was intended to show Hong Kong “better recognizes its role in asset allocation.”
SFC brokers general manager Eric Yip said the Hong Kong Securities and Futures Commission has promised to provide a finalized list of crypto exchanges that will receive full licenses by the end of the year.
Yip added that in early 2025, regulators will form an advisory panel to exchange licenses to continue collaborative efforts. The city also plans to release a comprehensive regulatory framework for crypto-focused over-the-counter trading desks and custodians.
On the same day, Hong Kong Exchanges and Clearing Limited issued a statement that it will launch a Virtual Asset Index Series on November 15, 2024.
The Hong Kong index series aims to provide greater benchmarking for Bitcoin and Ether pricing for regions across Asia-Pacific time zones. These developments are part of Hong Kong’s efforts to establish itself as the “leading digital assets hub” in Asia.
“By providing transparent and reliable real-time benchmarks, we strive to enable investors to make informed investment decisions, which will support the development of the virtual asset ecosystem and strengthen Hong Kong’s role as an international financial centre.”
HKEX Chief Executive Officer Bonnie Y. Chan
Moreover, the Hong Kong government has given the green light to different regulatory bodies to start creating policies covering the use of AI technology, foreseeing a future where financial institutions and other sectors in Hong Kong will be able to use AI in their operations.
“Hong Kong’s financial sector has what it takes to drive AI adoption: large markets and rich scenarios,” Hui said.
Hong Kong is currently caught in the crossfire of a technology dispute between the US and China. Because of this competition, many consumers in Hong Kong cannot access the world’s most popular AI service providers, which are mostly US-made, including OpenAI’s ChatGPT and Google’s Gemini.
On the other hand, Hong Kong consumers also like Baidu Inc. and ByteDance Ltd. has difficulty accessing Chinese-made artificial intelligence technology services provided by. Meanwhile, there has been an increase in the use of artificial intelligence in different institutions in the business and financial sectors. Sphere.
To solve this problem, Hong Kong wants to develop its own artificial intelligence technology. The Hong Kong University of Science and Technology is developing InvestLM, a broad language model tailored to local market rules. Once fully operational, the technology will be available to financial services in Hong Kong.