‘Crypto and DeFi Won’t Disappear’: Hong Kong Monetary Chief

Hong Kong Monetary Authority (HKMA) CEO Eddie Yue thinks cryptocurrency and decentralized finance (DeFi) will continue to play an important role in the financial system despite the recent instability in the sector.

• Speaking during a meeting of G20 financial officials, Yue called for greater regulation of the crypto industry to prevent another crash like the collapse of algorithmic stablecoin terraUSD (UST) and its companion token, LUNA, reports FinBold.
• “Despite the [UST-LUNA] incident, I think crypto and DeFi won’t disappear – though they might be held back – because the technology and the business innovation behind these developments are likely to be important for our future financial system,” Yue said.
• In January, the HKMA issued a statement signaling it would continue to cautiously explore its relationship with crypto assets by “striking the right balance between maintaining a safe and efficient financial system in Hong Kong and supporting financial innovation.”
• Later in the year, the HKMA released a discussion paper warning that the rise of a popular stablecoin could undermine Hong Kong’s local currency.