Hong Kong legislator Wu Jiexhuang has pushed for including Bitcoin in the country’s national reserves to ensure financial security and further diversify strategic assets. In an interview recently with the local newspaper Wen Wei Po, Council Member Wu, also Chairman of the Web3 Subcommittee on Virtual Asset Development, called for the region’s national reserves to include Bitcoin.
Wu argued that Hong Kong could take advantage of China’s “one country, two systems” policy to include Bitcoin in its reserves without necessarily contradicting the regulatory framework in mainland China. He explained that regulators must first study the impact of U.S.-issued Bitcoin ETFs before taking any action.
Bitcoin As a Strategic Reserve Asset
The lawmaker further said that China is already the world’s second-largest holder of Bitcoin reserves, with 190,000 BTC confiscated from illegal trades. He added that if leading economies start to put Bitcoin into their reserves, it would stabilize the value of Bitcoin and encourage other nations to do the same, reducing dependence on traditional assets like gold and silver.
Wu recommended Bitcoin over “small currencies” due to its high trading volume, which adds to its market desirability. He used examples of jurisdictions like El Salvador and Bhutan that have already integrated Bitcoin into their national reserves and several U.S. states with cryptocurrency strategies in place.
Growing Crypto Integration into Hong Kong
Wu explained that Hong Kong’s financial system is already adopting cryptocurrency in more ways. Currently, 12 ETFs tracking Bitcoin and Ethereum trade on the Hong Kong Stock Exchange. HKMA reportedly has taken a small amount of exposure to cryptocurrency, hedging its investments in such emerging markets.
He said this while calling on regulators to adopt a prudent yet innovative approach, using the “same business, same risk, same rule” when dealing with crypto assets within the national reserves.
That also came in tune with broader trends worldwide in the second half of this year when different lawmakers asked that Bitcoin be adopted into their national reserves. Within recent months, there have been such suggestions in Japan, Russia, and the European Union as some governments continue to hold out the skeptical viewpoint, though, and other governments are looking toward assessing a potential upside to holding Bitcoin as a strategic reserve asset.
The United States has been in the vanguard. Several states have already included Bitcoin in their financial plans, although wide federal acceptance remains doubtful.
This is not the first time lawmakers in Hong Kong have discussed including cryptocurrencies in the region’s fiscal policies. On Dec. 11, legislator Johnny Ng called for adding crypto assets to Hong Kong’s fiscal reserves. Joseph Chan, the Secretary for Financial Services and the Treasury, expressed opposition at the time, citing that “crypto assets are not our target investment for Hong Kong Exchange Fund.”
Wu believes that adding Bitcoin to Hong Kong’s reserves will help the City’s financial resilience and safety, especially in the rapidly changing economic environment.
Accordingly, the strategic inclusion of Bitcoin in this regard will position Hong Kong as a leading role player in the digital asset space and ensure its financial system stays future-ready. As the debate goes on, the proposal points to the increasing influence of cryptocurrency in setting fiscal policies across the globe. It is yet to be seen if Hong Kong will take this bold step.
