Hong Kong lawmaker proposes to incorporate BTC into the region’s fiscal reserves

Hong Kong may soon join the list of countries leveraging bitcoin (BTC) as a store of value and hedge against inflation by establishing the cryptocurrency as a tax reserve asset.

According to a local media report, Wen Wei Po, Wu Jiexhuang, a member of Hong Kong’s legislative council, has proposed incorporating BTC into the region’s fiscal reserves to improve financial security. He said that Hong Kong could use currency funds to acquire and hold BTC for the long term.

BTC as reserve asset in Hong Kong

Jiexhuang told Wen Wei Po that adding BTC to Hong Kong’s tax reserves could encourage the development of the local crypto industry, attract talent and investment, and increase transaction stamp tax revenue.

Leveraging China’s one-country, two-system policy, including BTC on Hong Kong reserves, could give the region a first-mover advantage and help authorities reduce economic disruptions caused by wider adoption of the asset in traditional markets.

“If major economic powers take the initiative to include Bitcoin in strategic reserves, the value of Bitcoin will become more stable, causing more and more countries to follow suit and reduce their holdings of traditional assets. This will lead to the fall in the price of traditional assets and will reduce the government’s fiscal reserves with traditional assets,” Jiexhuang said.

While the politician pointed out the benefits of buying and holding BTC, he also pointed out the risks associated with investing in the asset. He advised Hong Kong authorities to allocate a small percentage of national reserves to assets, starting with Bitcoin exchange-traded funds (ETFs). He urged the government to study the impact of the local US Bitcoin ETF market on the country’s financial industry and act accordingly.

Notably, Hong Kong already has a spot Bitcoin ETF market; however, its inflows pale in comparison to local US Bitcoin ETFs.

Following in Trump’s footsteps

Jiexhuang is not the first lawmaker to propose including BTC in Hong Kong’s reserves; another legislative council member, Johnny Ng, did the same in July 2024. Ng’s suggestion followed US President Donald Trump’s vote to create a national Bitcoin reserve at the Bitcoin Conference in Nashville earlier this year.

Both politicians believe that Trump’s proposal to create a strategic Bitcoin reserve for the United States could have a major impact on traditional markets and insist that Hong Kong could position itself as a financial center that promotes such technological advances.

Meanwhile, German lawmakers are also proposing the adoption of BTC as the country’s reserve asset.

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