Vitalik Buterin says projects should consider how long Hong Kong's crypto friendliness will last

Ethereum co-founder Vitalik Buterin said today that cryptocurrency projects looking to build up operations in Hong Kong should weigh in the level of stability of the government’s crypto-friendliness.

“If any crypto project wants to make Hong Kong their home, they would want to have some confidence — not just that it’s friendly now but that it will continue to be friendly years from now when all kinds of unknown, regulatory and political and other kinds of events are going to happen,” Buterin said at the Web3 Transitions Summit in Singapore.

“I don't understand Hong Kong well. I understand even less the complicated interaction between Hong Kong and the mainland lately,” Buterin added. “Obviously, it's very friendly now. But the big question that I'm asking and that I think anyone is asking is: how stable is the level of friendliness?”

Unlike its neighboring Chinese mainland’s broader crackdown on cryptocurrency trading and mining, Hong Kong has rolled out the welcome mat for crypto firms this year — even going so far as encouraging banks to work with them. In October 2022, Hong Kong authorities released a series of policy statements about cryptocurrencies to strengthen its position as a global financial center. In December, Hong Kong’s Legislative Council passed an amendment introducing a full licensing regime for virtual asset service providers that took effect in June.

When it comes to whether the Hong Kong government would continue supporting crypto, Buterin said he “personally has a hard time judging this question.” 

“To me, that's the key variable that I think is invaluable to understand,” Buterin continued. “If they can convince people that there is stability of the friendliness, then it's in a good position. But that's where I feel the challenge lies.”

Asia’s growing developer capacity

Buterin, who’s been in Asia for the past few weeks, said he was surprised at the engagement level of local developer communities.

“My biggest takeaway is that I've been impressed by how far things have stepped up on the research side,” Buterin told The Block at the event, adding that he’s been visiting India, Japan, Taiwan, Palau and Singapore for the past few weeks.

“The amount of activities I've seen in those spaces from every one of those countries that I mentioned has just really impressed me — just seeing the sheer number of people working on ZK and privacy solutions that are based in many places like Japan and Taiwan now.” Buterin said. “ It’s been impressive.”