Wu Jiezhuang believes that a government-backed stablecoin is far more beneficial than private stablecoins.
Realizing the potential of stablecoins and DeFi, authorities in Hong Kong have been exploring options to issue a central bank digital currency(CBDC) along the lines of a stablecoin supported by the government. The lawmaker spearheading the move is Wu Jiezhuang. A member of the Hong Kong Special Administrative Region’s Legislative Council, Jiezhuang firmly believes that converting the Hong Kong digital dollar (e-HKD) into a stablecoin would help gain access to the benefits of technologies like web3.
In an interview, Wu Jiezhuang claimed the measure had the potential to mitigate the risks related to virtual assets in web3. It would also lead to the renewed trust of investors in web3 and protect users from security issues. In reference to several stablecoin projects which failed in 2022, Jiezhuang admitted that there was no government supervision for such stablecoins issued by private companies. He stated that linking the stablecoin to DeFi would ensure better adoption and access to web3 ecosystems.
“The Hong Kong government can consider whether the issuance of digital Hong Kong dollars can be connected with decentralized finance and become an important infrastructure component of the virtual asset trading platform,” said Jiezhuang. He is also the co-founder of G-Rocket, whose goal is to attract 1000 web3 businesses and projects to Hong Kong in the next three years. Wu Jiezhuang joined a list of government officials who have advocated linking CBDCs and DeFi.