Key learning points
- Christina Choi, executive director of investment products at the Securities and Futures Commission (SFC), spoke at the Bloomberg Buy-Side Forum Hong Kong 2023.
- Choi highlighted the role of technology, especially AI and blockchain, in transforming the asset management industry.
- The SFC is working on guidelines for tokenization of investment products authorized by the SFC.
The dual role of SFC in asset management
Christina Choi, executive director of investment products at the Securities and Futures Commission (SFC), addressed the Bloomberg Buy-Side Forum in Hong Kong on September 26, 2023. She outlined the SFC’s dual role of protecting investors and maintaining market integrity, and strengthening market integrity. Hong Kong’s position as a global asset management hub. The SFC aims to strike a balance between regulation and innovation, ensuring that technological developments such as AI and blockchain can be integrated into the asset management sector without compromising market integrity.
The impact of technology on asset management
Choi highlighted the rapid technological progress, specifically mentioning the miniaturization of chip technology from 90 nanometers to just three nanometers in twenty years. She linked these technological leaps to the potential for “small changes” in the asset management industry that could result in significant market development.
Tokenization of retail investment products
One of the most notable points in Choi’s speech was the discussion on tokenization of SFC-approved investment products. Tokenization refers to the use of blockchain technology to create digital tokens that represent fractional ownership of an investment product. Choi said the SFC is currently working on detailed guidelines for tokenization, with a focus on primary trading at this stage due to the emerging state of Virtual Asset Trading Platforms (VATPs) in Hong Kong.
Regulation makes innovation possible
Choi emphasized that while innovation is crucial, it must be balanced with robust regulations to ensure sustainable development and investor protection. She cited historical examples such as the 2007-2008 global financial crisis and the consequences of unregulated crypto platforms to emphasize the importance of regulation.
Closing remarks
In her closing remarks, Choi drew an analogy between regulation and machine learning, arguing that just as “machine learning without regularization” is problematic, so too is “innovation without regulation.”
Disclaimer and Copyright Notice: The content of this article is for informational purposes only and is not intended as financial advice. Always consult a professional before making any financial decisions. This material is the exclusive property of Blockchain.News. Unauthorized use, duplication or distribution without express permission is prohibited. Any permitted uses require appropriate credit and direction to the original content.
Image source: Shutterstock