Ronald Leung’s original, dated commentary is reproduced below. Views, invitations and product references reflect the time of publication; they are not investment advice, an offer, a guarantee of return or confirmation of current availability.
The FCA is preparing a framework for tokenised gold. The reason it gave is worth reading twice: to protect the dominance of London.
Hong Kong does not need to catch up on this one. Cap 615 s.53ZTZ already defines a precious-asset-backed instrument. It then lists, one by one, six things such an instrument does not include:
-> a security under Cap 571 -> a futures contract -> an interest in a collective investment scheme -> a structured product -> an OTC derivative product -> a virtual asset
Those six are the line between Hong Kong Customs and the SFC, and they were drawn into the ordinance years ago.
So the open question is not whether Hong Kong can regulate tokenised gold.
In a recent interview with the South China Morning Post SCMP ,I asked: "Does it (Hong Kong) want to be a creator, or a follower?"
It is whether Hong Kong stays a warehouse for the metal, or builds at the instrument and settlement layers, which is a strong lever to power the economy of Asia.
And we're already few steps ahead.