The development of the Hong Kong dollar stablecoin is of great significance for Hong Kong's position in the Web 3.0 field. It can serve as a bridge between traditional finance and the DeFi ecosystem, and has the potential to become an indispensable part of the global financial system.

Article Author: 0x9999in1

Source: MetaEra

Recently, MetaEra's Hong Kong section has been launched with great fanfare, leading the "Two-Year Anniversary Celebration of Hong Kong's New Crypto Policy" series of events, one of which is the "High-End Dialogue: Influential Figures in Hong Kong Web 3.0." The featured interviewee this time is Qian Fenglei, Chairman of Hengfeng International Holdings Limited.

Profile

Qian Fenglei, a well-known entrepreneur, seasoned investor, and philanthropist. He is currently the Chairman of Zhejiang Hengfeng International Holdings Limited, with industries spanning mainland China, Macau, Hong Kong, and Southeast Asia. Qian Fenglei is renowned for his generous donations to charitable causes, having received the "Top Ten Charity Stars" award and being listed on several charity rankings.

Key Insights

● The core values of Web 3.0 lie in openness, privacy, and co-construction. It achieves decentralization through technologies such as blockchain and smart contracts, bringing new possibilities to financial services.

● I believe the policies and measures taken by the Hong Kong government to promote the development of Web 3.0 are very proactive and forward-looking.

● The development of the Hong Kong dollar stablecoin is of great significance for Hong Kong's position in the Web 3.0 field. It can serve as a bridge between traditional finance and the DeFi ecosystem, and has the potential to become an indispensable part of the global financial system.

● The Hong Kong dollar stablecoin and the digital Hong Kong dollar (CBDC) can develop complementarily. The digital Hong Kong dollar is suitable for circulation within Hong Kong, while the Hong Kong dollar stablecoin is more suitable for payment settlements in cross-border trade and services.

● The development of the Web 3.0 industry has transitioned from a grassroots era to an institutional era, moving from a state of disorder to a gradually regulated state.

● The application of blockchain technology in charity and public welfare not only improves transparency and efficiency but also enhances public trust, which is crucial for the sustainable development of charitable causes.

● Our vision for external output is to become a great company like Alipay in the crypto space!

Full Interview

MetaEra: Mr. Qian, Hengfeng International has always been relatively low-key, and there are few related media reports online. Does your acceptance of this interview with our Web 3.0 new media indicate a significant shift in the company's external strategy?

Qian Fenglei: Hengfeng International has always focused on investment management in traditional finance and the virtual field. Currently, the company is undergoing an important transformation into a technology-driven financial company, especially in the Web 3-based payment sector. This industry is still in its early rapid development stage and faces many challenges and uncertainties in terms of technological development, commercial application scenarios, compliance, and regulation. We need to integrate more resources, including financial and human investments. We are pleased to announce through this interview that we have just completed a $100 million special financing to integrate more upstream and downstream resources in the industry to bring new strength to the payment sector.

MetaEra: As a seasoned asset manager in traditional finance, how do you view Web 3.0? What opportunities and challenges do you think it will bring to you or the traditional asset management industry, and how will you respond?

Qian Fenglei: Web 3.0 is generally considered the next generation of the internet where all data and content are stored on-chain and owned by users. Its core appeal is to create a more decentralized and user-friendly environment and effectively counter the monopolistic giants of centralized internet. The core values of Web 3.0 lie in openness, privacy, and co-construction. It achieves decentralization through technologies such as blockchain and smart contracts, bringing new possibilities to financial services.

I believe the opportunities provided by Web 3.0 are multifaceted. In the investment field, Web 3.0 offers new investment areas such as crypto assets, NFTs, and DeFi, which bring new growth points to the traditional asset management industry. In terms of efficiency improvement, Web 3.0 can reduce transaction costs and enhance efficiency through smart contracts and blockchain technology, enabling low-threshold, high-liquidity transactions globally. In terms of data assetization, Web 3.0 facilitates data assetization, achieving efficient circulation of data and supporting high-quality development of the digital economy.

However, Web 3.0 still faces many challenges, with the three main challenges being regulatory uncertainty, technological risks, and market volatility. Regulatory uncertainty refers to the involvement of multiple financial regulatory policies in the actual operation of decentralized lending. Regulatory policies in various countries are still in the research and exploration stage, and there is no mature regulatory model, so the industry faces risks of regulatory policy uncertainty. Technological risks include risks arising from issues such as smart contract vulnerabilities and blockchain network scalability. Additionally, market volatility is also a concern for many, as decentralized lending is based on the logic of rising cryptocurrency prices, leveraging infinite circular pledges for arbitrage, which may amplify the overall market price volatility during periods of price increases and decreases.

Our response strategy includes strengthening regulatory cooperation, collaborating with regulatory agencies, and actively participating in the establishment of regulatory frameworks to ensure business compliance. You may have seen that we are currently actively cooperating with relevant regulatory agencies of the Hong Kong government, and all businesses are being conducted in compliance; another point is technological innovation and risk management, continuously focusing on and investing in key technologies such as blockchain and smart contracts, and establishing corresponding risk management systems to address technological risks.

MetaEra: We see that Hengfeng International, as a licensed asset management company in Hong Kong, has sent positive signals towards virtual assets. Could you inform us about the virtual asset allocations you have made? As a company that once managed assets worth over a hundred billion, do you have an estimated allocation ratio for crypto assets?

Qian Fenglei: Hengfeng International will enter this emerging market as a dedicated entity focused on the Web 3 field. We have made positive allocations in mainstream virtual assets and expect to further increase our positions in the future, but this is just our basic asset allocation. Our core direction remains in financial technology, meaning we will invest heavily in the infrastructure development of Web 3, especially in products and practices in the payment sector. Currently, we have already begun active actions through self-research and acquisitions, and we will soon announce a series of acquisition plans to achieve rapid resource and industry integration.

MetaEra: Given the Hong Kong government's positive attitude and policy support for the Web 3.0 industry since the issuance of the crypto policy in October 2022, and the frequent hosting of industry activities, how do you evaluate the policies and measures taken by the Hong Kong government to promote the development of Web 3.0? What areas do you think could be further strengthened?

Qian Fenglei: As a traditional finance practitioner in Hong Kong, I believe the policies and measures taken by the Hong Kong government to promote the development of Web 3.0 are very proactive and forward-looking. Here are my evaluations of the Hong Kong government's policies and areas that could be further strengthened.

First, let's look at policy support and market response. Since the Hong Kong government issued the "Policy Declaration on the Development of Virtual Assets in Hong Kong" in October 2022, it has shown a positive attitude and policy support for the Web 3.0 industry. This series of policies not only indicates the government's policy stance and guidelines on Web 3.0 but also sets the direction for future policy development, such as policies on stablecoins and tokenized assets (RWA). The market has responded enthusiastically, demonstrating the positive impact of these policies.

Next, there is the essential regulatory framework and industry development. The Hong Kong government has successively introduced a series of supportive and regulatory policies, including the establishment of the Web 3.0 Association, the Web 3Hub Fund, and the implementation of a new licensing system for virtual asset service providers. These measures provide a new starting point for the development of the Web 3.0 ecosystem and help establish a more regulated and healthy market environment, promoting the sustainable development of the industry.

To ensure the robust development of Web 3.0, talent policies and resource investment are also crucial. The Hong Kong government has proposed several talent-related policies in its policy report, such as establishing a "Talent Service Office" and expanding the "High-End Talent Pass Scheme." These policies help attract and cultivate the technology talents needed in the Web 3.0 industry. At the same time, the government has allocated HKD 62 billion to invest in sectors that contribute to the future economy, including financial technology (including virtual assets and Web 3), demonstrating the government's emphasis and investment in the Web 3.0 industry.

In summary, the Hong Kong government has already taken a series of positive policies and measures to promote the development of Web 3.0, but there is still room for further improvement and enhancement, especially in regulatory coordination, international cooperation, and public education.

MetaEra: The Hong Kong government is exploring the possibility of turning the digital Hong Kong dollar (e-HKD) into a stablecoin. We have seen that Hengfeng International has also strategically invested in one of the first three institutions for the Hong Kong dollar stablecoin "sandbox" testing. Could you share more details? How do you view the development of the Hong Kong dollar stablecoin?

Qian Fenglei: We have signed a confidentiality agreement with our investors, so we cannot disclose more details at this time.

The development of the Hong Kong dollar stablecoin is of great significance for Hong Kong's position in the Web 3.0 field. It can serve as a bridge between traditional finance and the DeFi ecosystem, and has the potential to become an indispensable part of the global financial system.

Although the stablecoin market is currently dominated by dollar-backed tokens, with the consolidation of regulatory frameworks, stablecoins backed by more fiat currencies are expected to grow. The development of the Hong Kong dollar stablecoin faces competition challenges from dollar stablecoins, but it also has enormous market potential, especially in areas such as cross-border payments and trade financing.

The Hong Kong dollar stablecoin and the digital Hong Kong dollar (CBDC) can develop complementarily. The digital Hong Kong dollar is suitable for circulation within Hong Kong, while the Hong Kong dollar stablecoin is more suitable for payment settlements in cross-border trade and services.

The development of the Hong Kong dollar stablecoin is a complex but opportunity-filled field. The Hong Kong government has already taken a series of positive measures to promote the development of this field, but further exploration and innovation are needed in terms of technical implementation, market promotion, and regulatory coordination.

MetaEra: In the face of the constantly innovating Web 3.0, new projects are emerging at a rapid pace. Is your company or you personally considering increasing investments in the primary sector? Will you establish a venture capital institution focused on investing in the Web 3.0 field?

Qian Fenglei: Hengfeng International has already entered this field through special fundraising, particularly in Web 3 payments. Both at the company level and personally, we will adopt an ALL-IN attitude to continuously produce results in this field and promote industry development. We have already begun investing in related companies in the upstream and downstream of the industry, and establishing a professional investment institution focused on the Web 3 field is already within our planning scope.

MetaEra: Considering the rapid development and widespread application of Web 3.0 technology, what strategic plans does your company have for the next five years to ensure competitiveness in this emerging field?

Qian Fenglei: First, we will strategically focus on the Web 3 payment sector. The industry's development from infrastructure, public chains, and protocols to the prosperity of DAPPs must go through payments, which is similar to the development path of Web 2. This is a large sector that requires significant resource investment. The development of this industry has transitioned from a grassroots era to an institutional era, moving from a state of disorder to a gradually regulated state. Hengfeng was born at such a time, backed by our extensive background and resources in the traditional financial industry, and we have just completed a $100 million fundraising. This is just the beginning of our integration of traditional industries and the crypto sector. Our vision for external output is to become a great company like Alipay in the crypto space!

MetaEra: You are personally passionate about philanthropy and have been listed on Forbes' charity rankings among the top hundred philanthropists. In the Web 3.0 era, do you believe that blockchain technology can better serve charity and public welfare?

Qian Fenglei: Blockchain technology provides a decentralized database, and its transparency and immutability make the process of donations and resource allocation more transparent and trustworthy. The public can track the flow of funds, ensuring that donations are used correctly, reducing the risk of corruption and misuse of funds.

Blockchain technology can create decentralized fundraising platforms, allowing donations to flow directly to beneficiaries, reducing intermediaries. Smart contracts can ensure that donations are automatically released according to agreed conditions, eliminating trust issues associated with traditional platforms.

Smart contracts can programmatically record and execute charitable donation agreements. Once specific conditions are met, such as reaching a certain amount raised, donations can be automatically released to beneficiaries. This not only reduces the risk of human intervention but also improves the efficiency of the donation process.

The traceability capability of blockchain can ensure the traceability of donations. Donors can track how their donations are used, ensuring that funds are correctly allocated to projects, thereby increasing public trust in charitable organizations and promoting the sustainable development of public welfare.

In summary, the application of blockchain technology in charity and public welfare not only improves transparency and efficiency but also enhances public trust, which is crucial for the sustainable development of charitable causes. With further technological development, we have reason to believe that blockchain will play a more important role in social welfare and charitable endeavors.