Hong Kong woos China crypto firms to bolster finance status

After years of bankers fleeing Hong Kong due to China’s security crackdown and strict COVID restrictions, the city is rolling out the red carpet for the financial sector to reinforce its status as a crypto financial hub.

Major upheavals and massive bankruptcies have forced some governments to distance themselves from the crypto spots. However, Hong Kong is pulling out all the stops for Chinese crypto companies to relaunch in the city.

Top government officials are voicing their support, and there will be 100 crypto conferences in the city.

The Hong Kong government is paying close attention to creating an international virtual asset center.

Many remain skeptical of Hong Kong’s new cryptocurrency regulatory law promise.

Ethereum’s latest blockchain update will result in volatility

The software underlies the second-largest cryptocurrency, Ether, received an update on Wednesday.

The move will give investors more than $30 billion of digital tokens.

Known as Shapella, the latest update to Ethereum’s blockchain since its Merge update will help investors redeem some of the Ether tokens they’ve deposited over the past few years in return for interest on the blockchain network.

The changes will likely result in increased Ether volatility.

Some experts believe widespread redemptions could lead to a sell-off phase, which would drive up the price of Ether, which has a market value of about $230 billion.

In its most recent major update, Ethereum slashed its power consumption by a large percentage in September. This move proponents said would give Ethereum an edge as it tries to overtake Bitcoin.

But Ether still lags behind its larger rival, gaining less than 60% this year versus Bitcoin’s more than 80% jump.

After a huge amount of dollars were wiped from the cryptocurrency market in 2022, the sector was boosted in 2023 by expectations that central bank interest rate hikes would slow down.

Ethereum has become popular in decentralized finance applications that offer financial services to consumers and avoid economic, financial centers such as banks.