Web3 Festival attracts smaller crowd, greater enthusiasm in Hong Kong after record bitcoin price

Attendance is down, but enthusiasm is up at Hong Kong's Web3 Festival this year amid sky-high bitcoin prices that have helped draw in an even greater proportion of overseas participants compared with last year.

The vast majority of participants - an estimated 80 per cent - came from outside Hong Kong, said Deputy Financial Secretary Michael Wong Wai-lun on Saturday in his opening remarks. The 2024 conference has seen more exhibitors from Europe and the US specifically, according to Lu Weiding, CEO of Wanxiang Group, which owns the event organiser HashKey Group.

As Hong Kong forges ahead with its push to transform into a major crypto hub, it has been attracting more Web3 events to the city and trying to bring in big-name speakers. Investor Cathie Wood, founder of US funds manager ARK Invest, was the most high-profile speaker at this year's Web3 Festival, although she dialled in remotely for a video chat. She praised Hong Kong's regulatory efforts and suggested the US is lagging behind.

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ARK Invest founder Cathie Wood speaks during a fireside chat with HashKey Capital at the Hong Kong Web3 Festival on April 6, 2024. Photo: SCMP / Matt Haldane alt=ARK Invest founder Cathie Wood speaks during a fireside chat with HashKey Capital at the Hong Kong Web3 Festival on April 6, 2024. Photo: SCMP / Matt Haldane>

"We are very impressed with what [Hong Kong] has done in providing a comprehensive regulatory framework for exchanges and institutions from a custody point of view," Wood said in an onstage interview with HashKey Capital. "This regulatory clarity is critical, we think, to enabling the proliferation of the technology faster perhaps in Hong Kong than in the United States."

Wood encouraged businesses in Hong Kong to take advantage of existing regulatory arbitrage as a "global opportunity". She also offered an extremely optimistic view of where the price of bitcoin is headed: US$1.5 million by 2030. Its record price was more than US$73,000 on March 13 and currently sits around US$68,000.

This year's Web3 Festival started shortly after the conclusion of the WOW Summit and the Liquidity 2024 Institutional Digital Asset Summit, which both dealt with crypto-related topics. Even more events are planned for later this year.

May will see both Wiki Finance Expo and Bitcoin Asia, and Chainlink will host its SmartCon event in Hong Kong in October. CoinDesk - recently acquired by crypto exchange Bullish, which has strong ties to the city - will bring its major Consensus conference to Hong Kong next year.

Still, the flood of events risks dividing attention, especially with so many other major events taking place in other locations. Token2049 - which holds its flagship event in Singapore and once took place in Hong Kong - is hosting its Dubai conference in two weeks. Paris Blockchain Week is also this week, and ETH Seoul was the last three days of March.

With other events clustered so closely together, the Web3 Festival was smaller in scale than last year, which happened a few months after Hong Kong announced it's big crypto push.

The event this year covers less area in the Convention and Exhibition Centre in Wan Chai, and it has fewer exhibitors, according to HashKey Exchange CEO Livio Weng. However, the event has more sponsorship revenue than last year, and there are more side events, he said.

Hong Kong has maintained its commitment to trying to draw the crypto industry to the city after a number of high-profile scandals and collapses in 2022 and 2023. A mandatory licensing scheme that took effect last year was meant to provide regulatory clarity to make the market more attractive. It has drawn 24 applicants so far.

The city is also moving to regulate stablecoins and over-the-counter cryptocurrency shops. Many are anticipating the approval of spot bitcoin ETFs, as well.

"Hong Kong remains the most exciting global opportunity anywhere for a firm wanting to build a virtual assets business or invest in virtual assets," said Sean Lawrence, head of Asia-Pacific at crypto data provider Kaiko. The city's advantages include supportive and clear policy directives, a talent pool with experience in traditional finance, and capital to be allocated to virtual assets, he added.

However, he noted that entrepreneurs and investors should be "prepared to commit significant time, money and effort", which are necessary to build consumer-protected, sustainable businesses in Hong Kong.

This article originally appeared in the South China Morning Post (SCMP), the most authoritative voice reporting on China and Asia for more than a century. For more SCMP stories, please explore the SCMP app or visit the SCMP's Facebook and Twitter pages. Copyright © 2024 South China Morning Post Publishers Ltd. All rights reserved.

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