Crypto Activity in Hong Kong Drastically Increased

As the Chinese mainland government continues its extensive ban of cryptocurrency, Hong Kong is seeing a sharp rise in crypto activity- the biggest in all of East Asia.

Despite severe government limitations on cryptocurrency usage in China, many of the country’s citizens are still using digital currency as a way to preserve their assets. Hong Kong, on the other hand, is a thriving crypto currency community, achieving the 30th highest use of crypto in the world, which is a jump up from the 47th ranking it has in 2023.

 

How much has crypto usage increased in Hong Kong from year to year? Estimates place it at about 86% each year, which is record breaking for that part of the world.

What has helped Hong Kong stand out among its East Asia neighbors has been its decisive efforts in establishing regulations that keep crypto safe, legal, and well monitored. Citizens feel like they can trust the framework that has been set up to keep them safe, and vendors feel like they can operate within that framework reasonably and still turn a profit.

When Crypto Markets Do Not Work

In mainland China, as well as in Russia and other countries with draconian crypto laws in the area, there are stark differences in how decentralized currency is approached. These governments are constantly restricting their laws further and further to drive out crypt miners and vendors and to make it harder on citizens to buy, sell, and own cryptocurrency. The laws are constantly changing, and the requirements to sell crypto are so complex that many crypto exchanges simply do not bother to operate in these areas.

Hong Kong benefits from some autonomy when it comes to its crypto laws. While the Chinese mainland government still exercises control over some aspects of Hong Kong’s government, in some areas it is very hands off, like in the area of cryptocurrency. So, the Hong Kong local government has freedom to create a well regulated market there.

Mainland China fell from 11th to 20th place this year for overall crypto activity as its strict bans on cryptocurrency continue. We will likely see those numbers all even further since the government there sees decentralized currency as an area of serious financial risk.

Chinese citizens still use over-the-counter platforms to buy and sell cryptocurrency, since major exchange platforms have been banned in China. Many of them are using these smaller platforms to transfer their wealth out of China where it will be more secure.

 

 

 

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ABOUT THE AUTHOR See More
Timothy St. John
Timothy St. John
Financial Writer - European & US Desks
Timothy St John is a seasoned financial analyst and writer, catering to the dynamic landscapes of the US and European markets. Boasting over a decade of extensive freelance writing experience, he has made significant contributions to reputable platforms such as Yahoo!Finance, business.com: Expert Business Advice, Tips, and Resources - Business.com, and numerous others. Timothy's expertise lies in in-depth research and comprehensive coverage of stock and cryptocurrency movements, coupled with a keen understanding of the economic factors influencing currency dynamics. Timothy majored in English at East Tennessee State University, and you can find him on LinkedIn.
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