Cryptocurrency investor Brock Pierce, co-founder of the stablecoin issuer Tether, hinted at a possible return to Hong Kong as the government intensifies its efforts to rejuvenate the crypto industry. Pierce, who also chairs the Bitcoin Foundation, remained enigmatic about his potential new venture and whether the city would be its permanent base.
Describing the city as part of a “continued conversation,” Pierce suggested that significant developments might be on the horizon.
Pierce’s Return Hong Kong
“Big things may come from this,” he told the South China Morning Post after the Solowin and Sequire Asia Investor Summit in Hong Kong on Wednesday while adding:
“I’m going to go where I think my time is most valuable. I’m enthusiastic about what’s happening in Hong Kong, which means I’m enthusiastic about working here, which means the likelihood of something happening is good right now.”
Pierce’s comments come at a pivotal time. Several large cryptocurrency exchanges, many with ties to mainland China, have recently withdrawn their applications to become licensed virtual asset trading platforms in the city.
This decision follows new regulations introduced last year by the Securities and Futures Commission (SFC), which recently stipulated that licensed exchanges in Hong Kong should not serve mainland residents. This directive has diminished what was seen as a significant incentive for establishing operations in the city.
Crypto and Hong Kong
Despite these setbacks, the potential for the special administrative region (SAR) of China to serve as a gateway to the substantial mainland China market remains a tantalizing prospect for many in the crypto industry.
Although commercial crypto activity is strictly banned in mainland China, the possibility of the city acting as an intermediary has been a popular topic among crypto enthusiasts. This was especially evident at this year’s Bitcoin Asia conference, even as mainland regulators show no signs of changing their stance.
Pierce, however, remains optimistic about the future. “Is China going to open up [to crypto]? … I’d say it’s inevitable,” he stated. “The question is not so much if, it’s a matter of when.”
Pierce Expresses Confidence in Regulations
He expressed confidence in the SAR’s recent moves to provide regulatory certainty to investors, positioning the city as a regional leader ahead of competitors like Singapore, Japan, and South Korea, which have also introduced their own crypto-specific policies. According to Pierce, trade finance (tradefi) represents a particularly strong opportunity for the city’s crypto market.
“I think Hong Kong is ahead in many ways,” he said. “I think the main opportunity in Hong Kong is in tradefi, and that’s where a Hong Kong digital dollar stablecoin has tremendous potential.” He cited China’s supply chain advantage as a key factor, suggesting that the right system could unlock significant opportunities.
Requiring Leadership
Addressing concerns about the high costs of the city’s licensing regime and other potential deterrents for companies, Pierce viewed these as temporary challenges. He expressed hope that policies would become more accommodating over time.
“Hong Kong is very well positioned, but it requires leadership,” he noted. “I think that Hong Kong has taken some of the first steps.”
