By Selena Li and Kane Wu HONG KONG (Reuters) -Hong Kong will ease rules and introduce a tokenisation pilot scheme to promote digital asset trading and investment, government officials said on Monday, as the city seeks to establish itself as a major fintech and digital asset hub. Hong Kong's Securities and Futures Commission (SFC) will relax rules on Monday to allow locally licensed virtual asset trading platforms (VATP) to share global order books with affiliates overseas, Julia Leung, CEO of the securit ...

Not even a $20 billion crypto market crash is stopping venture capital investors from piling into crypto startups. That’s according to Mike Giampapa, general partner of Galaxy Ventures, who told DL News that “we don’t see the recent deleveraging event as having an impact on the VC fundraising environment.” “While this was the largest notional crypto deleveraging event on record, we view it as a short-term microstructure-driven event more than a reflection of a fundamental shift in the market,” Giampapa s ...

Core Insights - The HKMA's e-HKD Pilot Programme Phase 2 Report highlights the transition from physical cash to digital money, positioning Hong Kong as a leader in digital finance and next-generation payment infrastructure [1][2] Digital Money Landscape - The report categorizes the evolving digital money landscape into public money, which includes central bank digital currencies like e-HKD, and private money, which encompasses tokenised deposits and regulated stablecoins [3] Innovations and Research - Innovations in Hong Kong are laying the groundwork for tokenisation, facilitating faster, more transparent, and programmable transactions that bridge traditional finance with the Web3 ecosystem [4] - The HKMA has been researching the e-HKD since 2017, conducting pilot studies and technical experiments for both wholesale and retail applications [4] Phase 2 Focus - Phase 2 of the pilot program expanded to compare e-HKD with private digital money forms, assessing usability, scalability, and commercial viability [5] Key Themes and Findings - The Phase 2 pilots involved 11 industry partners and explored three main themes: - **Settlement of Tokenised Assets**: Pilots tested e-HKD for atomic settlement of tokenised assets, showing that DLT-based settlement could reduce cycles from T+2 to T+0, enhancing liquidity and reducing counterparty risk [6][7] - **Programmability**: The report evaluated programmable payments using smart contracts and purpose-bound money, identifying limited commercial adoption models and unclear business cases for large-scale implementation [7] - **Offline Payments**: Offline e-HKD pilots examined Super SIM and NFC-based payments without internet connectivity, concluding that the offline e-HKD would provide limited incremental benefits given existing infrastructure [8]

Core Insights - The DeFi market is projected to reach $2 trillion by 2028, driven by Wall Street's increasing adoption of blockchain technology, with a potential increase of over 5,600% [1] - The stablecoin market is expected to grow to nearly $308 billion by 2025, supported by a more favorable US government stance [1][2] Market Composition - Tokenised money-market funds powered by stablecoins are anticipated to constitute $750 billion of the $2 trillion DeFi market, alongside $750 billion in tokenised equities and $250 billion in tokenised funds [2] - The remaining $250 billion will come from less liquid segments such as private equity, commodities, corporate debt, and real estate [3] Drivers of Growth - The DeFi boom is attributed to three main factors: increased awareness in developed markets, onchain liquidity, and the expansion of onchain lending [4] - Key players like Ethereum and DeFi protocols such as Aave are expected to emerge as winners in this evolving landscape [4] Institutional Engagement - The Ethereum Foundation has launched a new platform, "Ethereum for Institutions," aimed at assisting traditional financial institutions in integrating Ethereum's blockchain [5] Regulatory Environment - The US government's regulatory approach has shifted towards a more supportive stance, with pro-crypto appointments and significant legislative developments, including a stablecoin bill [6][7] - However, there are concerns regarding the potential lack of regulatory clarity if changes are not implemented before the November 2026 midterm elections [7]

Core Insights - Solana is experiencing significant demand, with the launch of the BSOL ETF achieving $220 million in first-day trading volume, marking the highest launch of any ETF this year across all asset classes [1] - The BSOL fund is projected to exceed $3 billion in assets, indicating strong institutional interest in Solana [2] - A total of four spot Solana ETFs have launched, with ten more awaiting approval from the SEC, reflecting a broader institutional shift towards Solana [2] Group 1: Institutional Interest - Institutions are increasingly gravitating towards Solana, with a distinct group of sophisticated buyers showing preference for it over Ethereum [3] - The "smarter than your average bear buyer" is particularly interested in Solana as a challenger asset [3] Group 2: Competitive Advantages - Solana's "ship-first" attitude allows for rapid product development and execution, contrasting with Ethereum's slower upgrade process [4] - The blockchain is leading in equity tokenization, favored for its speed and low transaction costs, making it suitable for financial applications requiring high transaction volumes [5] Group 3: Market Potential - The tokenization sector is projected to grow significantly, with estimates reaching $19 trillion over the next decade, attracting major asset management firms [6] - While Ethereum currently leads with $12 billion in real-world assets, Solana has seen a growth rate of over 300% in tokenized value compared to Ethereum's 50% increase [6]

Core Viewpoint - The Hong Kong Monetary Authority (HKMA) is prioritizing the development of the e-HKD for wholesale applications due to its greater potential value in large transactions compared to daily retail use [1][2]. Group 1: e-HKD Development Focus - The HKMA announced its decision to focus on wholesale applications after a second phase of e-HKD trials, which assessed usability and efficiency in both retail and wholesale scenarios [2][5]. - The e-HKD is recognized as a digital version of fiat currency built on blockchain technology, which is free of credit risks, making it desirable for financial institutions in large-valued transactions [2][4]. Group 2: Future Applications and Partnerships - Financial institutions have already utilized the e-HKD for wholesale interbank cross-border settlements and securities transactions, with the HKMA aiming to attract more large financial institutions and companies for future pilot projects [5][7]. - The HKMA has not provided a specific timeline for the wholesale application of the e-HKD, indicating that the rollout will depend on advancements in technology and user attitudes towards central bank digital money [6]. Group 3: Industry Collaboration - The HKMA expressed encouragement regarding the gradual increase in wholesale applications of the e-HKD by financial institutions and emphasized the importance of continued collaboration with the industry on the CBDC and tokenization journey [7].

Regulatory Landscape - UK's FCA proposes allowing fund managers to tokenise investment funds [1]

Core Viewpoint - The UK's financial regulator is promoting the tokenisation of funds on public blockchains to attract younger investors and enhance the competitiveness of the asset management industry [1][4]. Group 1: Tokenisation and Its Implications - Tokenisation, the creation of blockchain-based versions of financial assets, is gaining traction due to rising crypto prices and support from influential figures [2]. - The Financial Conduct Authority (FCA) believes tokenisation could fundamentally change asset management, benefiting both the industry and consumers [3]. - The FCA's proposal allows UK asset managers to issue crypto tokens representing shares in their funds on public blockchains like Ethereum, marking a significant shift from previous restrictions [1][4]. Group 2: Regulatory Considerations and Risks - The FCA acknowledges that public blockchains have technological limitations that may pose risks to consumer protection, market integrity, and market stability [5]. - Firms are required to continue meeting their regulatory obligations despite the new proposals [5]. Group 3: Targeting Younger Investors - The FCA is seeking feedback on the use of stablecoins for fund settlements, recognizing that benefits from these changes may take time to materialize as firms upgrade their technology [6]. - Nearly half (47%) of trading app users are aged 18-34, indicating a shift in consumer expectations around investing, with these platforms typically offering low-cost investments [7]. - The FCA plans to explore the possibility of allowing regulated funds to invest directly in cryptocurrencies in future reviews [7].

💥BREAKING:NYSE TO PARTNER WITH POLYMARKET ON FUTURE TOKENISATION INITITIATIVES. https://t.co/DQogCjiLVx ...

RT Crypto.com Research & Insights (@cryptocom_rni)Crypto Market Pulse Weekly:🚀 Stablecoin market capitalisation reached $300B📃 https://t.co/hb29mmurpq obtains a full stack of CFTC derivatives licenses🤝 Cronos partners with Amazon Web Services to advance institutional tokenisation and RWAThe details 👇https://t.co/SwdGwoV6Qw ...