Hong Kong could be a ‘tailwind’ for lagging crypto activity in Asia: Chainalysis
Recent crypto advancements in Hong Kong could provide a “potential tailwind” to lift crypto activity in the East Asian region, which has mainly suffered from a China-wide ban on trading activities since 2019.
Cryptocurrency value received in East Asia amounted to just 8.8% of the world between July 2022 and June 2023, according to an Oct. 2 report from Chainalysis, making it the fifth most active crypto market. However, Chainalysis said Hong Kong’s recent moves could help increase this number.
“A potential tailwind for East Asia comes from Hong Kong, where several crypto initiatives and industry-friendly regulations launched over the past year have fostered bubbling optimism.”
Data from Chainalysis reveals that East Asia’s share of crypto transaction value went from around 30% in 2019 to less than 10% by the second quarter of 2022, after a number of crypto-related bans in China.
However, Chainalysis said there is “bubbling optimism” in Hong Kong, noting that despite its much smaller population, Hong Kong is already an “extremely active crypto market” by raw transaction volume.
Between July 2022 and June 2023, the market received an estimated $64 billion in crypto, compared to $86.4 billion in China, despite having a population of just 0.5% the size of the mainland.
In comments to Chainalysis, Merton Lam of CryptoHK, an over-the-counter digital asset trading center in Hong Kong, said that cryptocurrencies are becoming a staple in the investment portfolios of many banks, private equity firms and high-net-worth individuals that they work with within the region.
In addition, Chinese state-owned businesses have also launched cryptocurrency-focused investment funds of late.
That being said, Dave Chapman of digital asset platform OSL Digital Securities told Chainalysis that while digital assets “are not going away” in East Asia — it’s still too early to say whether Hong Kong’s crypto ambitions mean China has fully embraced the cryptocurrency space.
“The promotion of Hong Kong as a potential crypto hub is not necessarily indicative of the Chinese government’s stance on crypto […] This could be viewed as an exploratory approach to understanding digital assets without loosening mainland policies.”
Related: Hong Kong retains top crypto-ready position for two consecutive years
Speaking to Cointelegraph, Matrixport’s Head of Research and Strategy Markus Thielen said Hong Kong will serve as a “testing ground” for broader cryptocurrency adoption in China.
However, Hong Kong is making a big play in one particular area which other states haven’t managed to capitalize on, says Thielen:
“Crucially, there is a genuine interest to attract the crypto asset management industry which has so far been a missing piece of the puzzle as most crypto firms tend to be labeled as service providers, instead of being the end-user of crypto.”
Magazine: Are DAOs overhyped and unworkable? Lessons from the front lines
The World Transformed, a left-wing political festival, has historically ran alongside the Labour Party Conference as an unofficial fringe event.
But a lot has changed since it began in 2016, organised then by the Corbyn-backed group Momentum. And like the former Labour leader himself, TWT has gone independent.
From Thursday to Sunday, a programme of politics, arts and cultural events will be held in Manchester, a week after Labour’s annual party gathering ended.
“It no longer made any sense to be a fringe festival of the Labour conference,” Hope Worsdale, an organiser since 2018, tells Sky News. “We need a space for the independent left to come together.”
This decision was made before the formation of Your Party in July and the surge of support behind the Greens and its new leader Zack Polanski, but both these factors have given TWT some extra momentum. Organisers say it is not just a festival, but a “statement of intent from the British left” – and a left that looks different from how it used to.
Previous headline speakers were Labour MPs in the left-wing Socialist Campaign Group, and in 2021, the showstopper was American democrat Bernie Sanders calling in live for an event alongside John McDonnell.
The World Transformed, previously headlined left-wing Labour MPs
Bernie Sanders and John McDonnell in conversation at TWT in 2021
This year, Mr Polanski, Jeremy Corbyn and Zarah Sultana are the only British politicians due to speak at events – though Brian Leishman, who lost the Labour whip in the summer, is also scheduled on a panel.
TWT was put on pause last year for organisers to reflect upon its role going forward, after Sir Keir Starmer’s election victory.
In 2021, 2022 and 2023, while he was leader of the opposition, the festival was able to “co-exist” with Labour as a space for activists on the left to discuss ideas.
But the prime minister’s “shift to the right” has alienated so many of those grassroots members that it was felt TWT’s core audience would no longer be at Labour Party conferences, says Hope, who joined Labour in the Corbyn years and has since left.
TWT in 2016. Pic: TWT
Event at TWT in 2023
“Our official position isn’t that Labour is dead and no one should engage with it,” she says.
“But they have shifted the values of Labour so radically since the last election, broken promise after promise, attacked civil liberties… there’s been such a suite of terrible decisions that mean people who are generally progressive and generally left wing feel like they have to take their organising elsewhere.”
So what’s on the cards?
There will be 120 events held in Hulme, Manchester, from Thursday to Sunday evening.
At the heart of the programme is daily assemblies, which organisers say are “designed to hold genuinely constructive debates about what we should do and how we should do it”.
But there’s just as much partying as there is politics – Dele Sosimi and his Afrobeat Orchestra are headlining the Saturday night slot while a “mystery guest” will host what TWT calls its “infamous” pub quiz on Friday night.
Back in 2018 that was Ed Miliband’s job, when 10,000 activists were expected to attend TWT. This year, organisers anticipate around 3,000 people will gather, but those involved insist this is a real chance for the left to strategise and co-ordinate, given the involvement of over 75 grassroots groups, trade unions, and activist networks.
Collaboration ‘vital’
A key question the left will need to address is how it can avoid splitting the vote given the rise of the Greens, socialist independents and the formation of Your Party,
One activist from the We Deserve Better organisation, which is campaigning for a left-wing electoral alliance and will be at TWT this weekend, acknowledged collaboration is “vital” if the left is to make gains under Britain’s first-past-the-post system.
Jeremy Corbyn at TWT. Pic: Reuters
But it remains to be seen whether Your Party co-leaders Mr Corbyn and Ms Sultana can even work together following their public spat last month, let alone with other parties. The pair put on a united front at a rally in Liverpool on the eve of TWT, when Sultana said she was “truly sorry” and promised “no more of that”. But will the truce last?
“It’s not ideal”, says the activist. “Hopefully they are back on track…a lot of collaboration is happening at the grassroots and we need to make sure it’s formalised so we can beat Labour and the right, we need to put on united front.”
They point to seats like Ilford North, where Health Secretary Wes Streeting clung on by a margin of just 528 votes in the general election, after a challenge from British-Palestinian candidate Leanne Mohamad, who ran in protest against Labour’s stance on Gaza.
Meanwhile, in Hackney, the Greens are hoping to gain their first directly elected mayor next May, with the Hackney Independent Socialist Group of councillors throwing their weight behind the party’s candidate, Zoe Garbett.
The We Deserve Better activist says Labour’s “hostile war on the left” has made these areas ripe for the taking, and what is more important than party affiliation is galvanising momentum behind one candidate who shares socialist values on issues like public ownership and immigration – be they the Greens, independents, or Your Party.
“The World Transformed reflects a general reorientation of the left outside of Labour. If they are taking these places for granted, we are going to win. If we unite as the left then we can win even bigger. Bring it on.”
Is Labour in danger?
There is some cause for Labour to be worried. It is haemorrhaging votes to both the right and the left after a tumultuous first year in office (13% to Reform UK, 10% to the Greens and 10% to the Lib Dems, according to an Ipsos poll in September).
Many Labour MPs feel the prime minister has spent too much energy trying to “out Reform Reform” with a focus on immigration, and he needs to do more to win back moderate and progressive voters that will be gathering at TWT this weekend.
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Starmer’s ‘anti-Reform party’ gamble
One fed-up MP told Sky News it was a shame TWT had decided to branch away from Labour, but not a surprise.
“This was something that was on the cards for a while, a parting of the ways, it’s another thing to show what’s happening with the direction of the party.”
He said in previous years the festival “was full of people for the first time in their life who were excited about politics and had a leadership looking at how it could challenge the biggest issues in our country”.
“Debates could be heated but it was always a place for intellectual discussion and that inside the Labour Party is now dead.”
But he said the party ultimately had bigger things to worry about than TWT, with a budget round the corner and potentially catastrophic local elections in May.
“I don’t think it will keep Keir Starmer or Morgan McSweeney up at night.”
The Irish Communications Interception and Lawful Access Bill is still in development, with drafting yet to occur, but the Global Encryption Coalition wants it scrapped now.
Ministers must do “much more” to explain why Palestine Action is a proscribed terrorist group, Harriet Harman has said.
Speaking to the Sky News Electoral Dysfunction podcast, the Labour peer said the government looked like it was just “arresting octogenarian vicars who are worried about the awful situation in Gaza”.
Baroness Harman, who was a Labour MP from 1982 to 2024, said the government had a “number of incredibly important duties” with regard to the war in Gaza – including protecting the Jewish community while also permitting free speech.
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She said that as well as ensuring the safety of Jewish venues, such as schools and synagogues, the government also needed to “try and create an atmosphere where the Jewish people should not feel that they are under threat and be asking themselves whether this is the right country for them to live in and be bringing up their families”.
Baroness Harman went on: “They also have to support and uphold the right to free speech and the right of protest. And people have felt so horrified.
“We all have about the devastating loss of life and suffering in Gaza. And so it’s right that people are allowed to protest.”
A number of protests in support of Palestine Action have been organised in recent months following the group’s proscription under anti-terrorism laws in July, after members targeted RAF Brize Norton and damaged two military aircraft.
Protests against the British government’s ban on Palestine Action
Last week, there were calls for the demonstrations to be halted following the attack on Heaton Park Synagogue in Manchester, in which two people were killed – but a number took place across the country, including in London.
The Labour peer said the organisers of such protests had a responsibility not to allow people to support a “terrorist organisation” but that the government also needed to do “much, more more” to explain why Palestine Action had been proscribed.
Read more:
What does Trump’s Gaza peace plan look like?
Trump’s Gaza deal may not please everyone – but it offers hope
“At the moment, it just looks like the police are arresting octogenarian vicars who are worried about the awful situation in Gaza,” Baroness Harman said.
“So they’ve got to actually be much clearer in why Palestine Action is a terrorist group and that they’re justified in prescribing them and making them illegal.
“But also the police have got to police those marches in stopping them being about the spouting of hatred and inciting violence, with people talking about globalising the intifada, which basically means killing all Jewish people.
“And the police do actually have very wide-ranging powers, not just to arrest people, but to actually ban marches.“
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