In the past few days, news about domestic securities firms' overseas companies obtaining cryptocurrency trading licenses in Hong Kong has been highly hyped in both mainland China and Hong Kong, with such high enthusiasm even driving significant stock price increases for related companies in Hong Kong and A-shares.
The sensation was caused by Guotai Haitong's Guotai Junan International officially receiving approval to provide cryptocurrency trading services in Hong Kong. This is the first Chinese securities firm to obtain such a license.
Unlike the well-known compliant Chinese background exchanges (such as HashKey), this company originates from a securities firm. Obtaining a crypto license is an expansion of their existing business, which increases business imagination; additionally, the name "Guotai Junan" easily makes people wonder if this news implies that mainland China is starting to loosen up in certain aspects.
My view on this remains cautious.
Whether it was the previous hype about stablecoin-related companies or this news, in my opinion, it is more about releasing optimistic emotions and elevating expectations for the future.
People are optimistic and hope that Hong Kong, based on its status as a global free port, can occupy a place in the global crypto ecosystem and attract global participants.
If Hong Kong wants to compete in the global crypto ecosystem, its direct competitor is the United States. Currently, the US is superior to Hong Kong in both regulation and user volume.
In terms of regulation, US regulatory policies are significantly more relaxed than Hong Kong's, and the crypto ecosystem's infrastructure is much better.
In terms of user volume, domestic US users are sufficient to support imaginative application scenarios, whereas Hong Kong certainly cannot rely on its local user volume.
Under these circumstances, what Hong Kong can strive for is attracting potential user volume - which I believe is the fundamental basis of the aforementioned optimism and expectations.
The core projection group for this optimism and expectation is the 1.4 billion population of mainland China.
However, mainland China's foreign exchange control constraints make it difficult to truly release these expected dividends.
A few days ago, domestic channels opened direct cross-border transfers between mainland and Hong Kong banks. Many media hyped this as a loosening of controls. In fact, this only improves transfer efficiency and reduces costs, with cross-border transfer quotas remaining unchanged.
In the past two years, mainland residents could directly apply for an account at HSBC offline and receive a Hong Kong card the same day, but now offline applications have been suspended, seemingly only allowing online applications and making same-day card issuance impossible.
These details show that foreign exchange controls have not been relaxed.
Additionally, Hong Kong's crypto trading has always been very strict, with no relaxation in account holder identity verification.
For instance, the most well-known compliant exchange HashKey still only allows Hong Kong residents, permanent residents, and mainland residents with legal overseas identities to apply for accounts.
Moreover, even mainland residents who obtain a Hong Kong card and use asset trading services from Hong Kong banks face strict restrictions on cryptocurrency trading.
There are no signs of relaxation in these controls, and I estimate there won't be any in the near future.
With unchanged foreign exchange controls and identity verification, the 1.4 billion mainland population remains just a "moon in the water, flower in the mirror" - visible but unattainable.
Of course, this doesn't mean these Hong Kong policies are useless; they certainly have value and will significantly help financial institutions expand and extend their businesses. However, the actual impact and effect differ greatly from the imagined potential. This gap is always disappointing.
Moreover, when seeing countries on the other side of the planet racing ahead in this track while the nearby free port seems constrained, there's an inexplicable sense of unresolved frustration.
