Hong Kong's Bold Move: Will It Launch Its Own Crypto to Outshine USDT and USDC

Experts propose Hong Kong's own stablecoin, HKDG, to boost its fintech power and lessen U.S. Dollar reliance.

A new plan suggests that Hong Kong should create its own stablecoin, called HKDG. This would be based on the city's foreign money reserves, allowing it to compete with other stablecoins like USDT and USDC.

This idea is from Wang Yang from the Hong Kong University of Science and Technology, angel investor Cai Wensheng, Lei Zhibin from BlockCity, and a Ph.D. student Wen Yizhou. They believe a stablecoin tied to the Hong Kong Dollar could help more people access financial services, make transactions faster, lower costs, and improve the city's fintech strength.

These experts feel that the current government plan to let private groups make stablecoins isn't enough and may only result in a small market share. They compare this to Singapore's XSGD stablecoin, which has a market value of $6.6 million, while USDT and USDC together have more than $110 billion.

They claim an HKDG stablecoin backed by the Hong Kong government could be more trusted and have less risk because of the city's huge foreign money reserves - over $430 billion.

While the proposal admits there could be some risks like legal issues, technical problems, and changes in exchange rates, it believes a government-backed HKDG would have lower risks than a privately-issued stablecoin. The authors argue that an HKDG could also help Hong Kong reduce its dependence on the U.S. Dollar** in the digital money world.