From CZ's timely speech in Hong Kong, where are the next opportunities for Web3?

The former Chinese billionaire Zhao Changpeng recently delivered a speech at the University of Hong Kong and Bitcoin Asia 2025, which many in the crypto world have likely seen. From the defendant's seat in a Seattle federal court to the main stage of a conference in Hong Kong, Zhao Changpeng's trajectory over the past year has been tumultuous. His choice to appear in Hong Kong at this moment precisely aligns with the crucial on-chain regulatory milestone in Hong Kong—the formal implementation of the stablecoin regulations, with tech giants like Ant Group and JD.com eager to enter the stablecoin race. This article will deeply summarize Zhao Changpeng's core statements at the two meetings in Hong Kong, linking the background of Hong Kong's “traditional experience + institutional innovation”, seeking the bridge between traditional finance and on-chain value, and exploring the possible compliance paths and next opportunities for Web3 projects in the future.

1. What are the three major challenges of RWA and what is the main theme?

The imagination space for RWA is very large and has been very popular recently. After Kaisa Capital (00936.HK) announced its strategic transformation and the development of a tokenization business layout for real-world assets (RWA), the company's stock skyrocketed by 250% today. So, is RWA really that easy to handle? Zhao Changpeng previously pointed out the three major difficulties in implementing RWA directly in Hong Kong:

The first mountain, liquidity dilemma. The trading frequency of real estate and collectibles is very low. If tokenized on-chain, the depth of buy and sell orders will definitely be insufficient. It’s hard to buy when you want to, and hard to sell when you want to. Large capital inflow and outflow is very difficult. Without liquidity, tokenization loses its core value.

The second mountain, the complexity of regulation. Are tokenized assets securities or commodities? Who regulates them? The Securities Regulatory Commission, the Commodity Futures Trading Commission, or other departments? How do you obtain the license to operate this business? The asset attributes of RWA are very ambiguous; is it a security or a commodity? The answers may vary significantly across different countries and regions. This means that if an RWA business wants to achieve globalization, it may need to apply for a variety of licenses around the world, leading to substantial compliance costs and difficulties, which severely limits its business model's extension. Currently, the issue of linking tokenized stock products to real stock prices has not been resolved, so the mechanism is not valid.

The third mountain, defects in product mechanisms. Currently, there are some stock tokenization products on the market, and the price of the tokens often decouples from the anchored real stock price, indicating that the inherent arbitrage mechanism may be ineffective. A financial product that cannot self-correct its price through market forces has an unstable foundation.

Although RWA faces so many difficulties, should we just not do it? Zhao Changpeng believes that this must be done, and the main theme of RWA is transparent profits from stocks and bonds. Currently, stablecoins are the most successful RWAs, and the underlying assets of stablecoins are real assets such as the US dollar and government bonds. US government bonds are the most liquid and standardized assets globally. For international financial centers like Hong Kong, developing RWA is even a strategic necessity. If you don't do it and others do, you will be marginalized. Today is a golden window period for the development of RWA, a time to overcome difficulties and seize opportunities, and the Hong Kong government is also actively promoting this.

If a company plans to issue bonds through the RWA project, Lawyer Liu hopes the company can first consider these two core questions: First, does your project qualify for issuance? Will the broker help you sell it? Also, whether the asset class, evaluation, and guarantee arrangements meet the broker's standards. Second, can you accept the costs and profit margins? It is important to know that the costs of issuing RWA bonds are even higher than traditional IPO costs, involving domestic and foreign lawyers, fund agency services, accounting audits, blockchain technology services, broker fees, etc. In addition to the service fee charged by brokers calculated based on the financing amount and subsequent underwriting fees, other costs are also no less than 5 million Hong Kong dollars. These must be fully considered during the project design phase, including the entire project implementation cycle. If the company only seeks to boost its stock price and then withdraws halfway after a rush, it will only be counterproductive.

2. Stablecoins can serve as “tools in the crypto world”

Upgrade to “financial infrastructure”?

Zhao Changpeng referred to stablecoins as “a new vehicle for the internationalization of currency”, believing that stablecoins will shift from being a safe-haven asset to the infrastructure for global payments and capital flows. He believes that the U.S. government deeply understands the value of stablecoins for the global strategic position of the dollar; currently, the vast majority of USDT users are located outside the United States, which is essentially an extension of the dollar's influence globally. Stablecoins are tools for the globalization of underlying currencies, and every country should have its own stablecoin products. Interestingly, when the U.S. enacted the “Genius Act”, it also proposed to ban central bank digital currencies (CBDCs) because the U.S. already has dollar stablecoins like USDT and USDC. For our country, promoting the development of RMB or HKD stablecoins could provide a new Web3 channel for the RMB. Although freely circulating blockchain assets will challenge foreign exchange controls, countries are actively exploring solutions, and Hong Kong is also taking the lead in this race.

Regarding the challenges of stablecoins against foreign exchange controls, currently, the trading of stablecoins is not allowed within our country, and related cross-border capital flows are still restricted by foreign exchange management regulations. The system represented by the “Notice of the State Administration of Foreign Exchange on the Foreign Exchange Management Issues Related to Domestic Residents' Overseas Investment and Financing Through Special Purpose Companies and Return Investment” (i.e., “Document No. 37”) remains the main compliance path for domestic individuals or institutions to handle the legal return of capital and profits in foreign investment. However, we believe that in the future, the foreign exchange bureau may consider opening policy loopholes for stablecoins in certain controlled scenarios, and China has to take this step. This is an important step to respond to the demands of international competition and the development of the digital economy, avoiding being marginalized in the global crypto and payment arena.

Three, DAT will become traditional capital

Entering the Compliance Bridge of Web3?

DAT (Digital Asset Treasury Companies) refers to publicly listed or open entity companies that incorporate digital assets (primarily cryptocurrencies or stablecoins, tokenized real assets, etc.) as a core component of their balance sheets. They raise capital by issuing stocks, bonds, or similar instruments to gain exposure to crypto assets, thus providing traditional investors with an indirect way to participate in the digital asset market. Zhao Changpeng holds a very supportive attitude towards the DAT model; he believes that the traditional stock market is much larger than cryptocurrencies, and this circle is much larger than the crypto world. For the world's largest economy, the vast majority of assets are managed by institutions. Currently, these institutions cannot hold cryptocurrencies directly on a large scale until the emergence of ETFs. However, DAT now provides more options for entities that cannot directly purchase bitcoins, such as listed companies, state-owned enterprises, and central enterprises, allowing them to indirectly access cryptocurrencies by buying stocks, thus opening a door for substantial traditional funds to enter Web3 in compliance. DAT can be understood as a channel or bridge connecting TradFi and Web3. With more money coming in, the stability of this market will naturally be higher.

Zhao Changpeng suggests that although the “strategy” you adopt in the DAT model can be quite varied, from the simplest holding of Bitcoin to actively managing trades and even investing in entire ecosystem projects. However, simple strategies are often more prudent: clear positions, simple trades, and clear risk control. This is because many lawsuits may arise during a bull market. Lawyers advise that if the strategy is clear, along with seeking professional assistance, the likelihood of being sued will be significantly reduced.

4. “AI + Web3”: Is it just a hype or can it really be implemented?

Zhao Changpeng pointed out that most of the so-called “AI+Web3” projects on the market are just hot air with no practical function. Although the combination of the two is not yet mature at this stage, it is definitely not just a concept, and the future is promising. He believes that programmable money is the foundation of everything: If money itself can be programmed and automatically trigger certain logic, it can greatly expand the role of AI in payment and value settlement. The ultimate development of AI is still inseparable from cryptocurrency, because in the payment process, AI does not have an ID and cannot perform KYC like a human, which will inevitably use digital currency and blockchain for payments. In the future, there will be interactions between AIs and between AI and services, some of which are financial and some non-financial. This machine-to-machine payment may involve massive high-frequency interactions and value settlements, especially for very small micro-payments, where using cryptocurrency through APIs will be the most convenient and efficient, potentially triggering a thousandfold increase in on-chain transaction volume.

Our RMB, USD, and HKD are all non-programmable. Recently, there have been projects moving in this direction: in September, Google launched the Agent Payments Protocol (AP2), allowing AI Agents to use programmable currencies like stablecoins to perform automated payments in agent-to-agent (machine-to-machine) or agent-to-service scenarios. The true catalysts for realizing this will be the development of AI itself; AI computing power requires astronomical funding support, which will encourage the AI industry to embrace Web3, such as financing through tokenization, and even moving towards a more open and public model. In the future, when everyone may have hundreds of AI agents completing various tasks in the background, leading to a massive amount of micropayments, this model cannot be realized under traditional financial models, but Web3 can easily support it. This will bring significant legal challenges; first, when AI agents make erroneous trades, experience fraudulent attacks, or suffer from authorization abuse, who will bear the responsibility? The protocol designer, the entity to which the agent belongs, or the user? Second, regarding breakthroughs in regulatory/privacy compliance requirements, such as transaction auditing, payment chain transparency, anti-money laundering (AML), and anti-terrorist financing (CFT) mechanisms, will they be embedded in the system? Finally, with the potential explosive growth of on-chain transaction volumes, issues such as cybersecurity, tax compliance, cross-border payments, and data sovereignty will also be brought to the forefront.

V. Institutionalization and Regulatory Clarity: Boon or Shackles?

The current debate in the crypto world is whether or not to allow national and institutional participation. The extreme decentralization faction and “pure Bitcoinists” firmly oppose it. However, Zhao Changpeng's speech at the conference provided a completely different answer — it is a good thing. Zhao Changpeng stated plainly: the participation of the state and large institutions will bring funding, bring nodes, and bring credibility; more importantly, it will bring application scenarios. Once the state begins to establish a “national-level encryption asset strategic reserve,” regulation will not be absent, the rules will be clearer, and the market will be more stable. The trend of Bitcoin in 2025 has already partially reflected this trend. At the beginning of the year, everyone said the UAE was pioneering, but now the US has obviously accelerated its pace. On August 29, Zhao Changpeng saw that the US Commodity Futures Trading Commission (CFTC) was preparing to release a draft rule regarding the registration of foreign exchanges (FBOT), which will provide a compliance path for non-US exchanges to allow US users to participate. He directly lamented that he had once been imprisoned due to national trade protectionism, but he is an advocate of economic globalization. Blockchain technology can easily achieve economic globalization, so it is necessary to upgrade old laws to keep pace with globalization.

The United States is speeding up, and Hong Kong is also striving to establish itself as a compliant “new highland” after the implementation of the stablecoin regulations through legislation, licensing, and regulatory guidelines. Standard Chartered (Hong Kong), Animoca, and HKT have teamed up to establish Anchorpoint and apply for a stablecoin issuance license. This is a signal: licenses and application scenarios will be the main theme of the next round of competition. This means that the crypto industry is no longer just a game for small circles but a competitive arena for large institutions and real funds. Interestingly, Eric Trump, the son of Donald Trump, publicly supported Bitcoin during the closing discussion at Bitcoin Asia 2025, predicting that Bitcoin will rise to 1 million dollars in the future, and praised China's role in the development of cryptocurrencies. Meanwhile, a senior official from the Hong Kong Securities and Futures Commission and a legislator were temporarily removed from the speaking list to avoid interaction with Eric, which also indirectly proves the intertwining of crypto, geopolitics, and politics. In the current environment of heightened political sensitivity, public statements and market promotions by companies and individuals need to be more cautious and compliance-friendly.

Institutionalization means that traditional capital will enter on a large scale, and the crypto industry will no longer be a small circle of self-entertainment. With regulation, although the threshold is high, capital is flowing in, and the liquidity and scale of the entire market will be amplified. How can compliance red lines and business speed be compatible? On the practical level, Hong Kong authorities have reminded the market: as of August 1, the “stablecoin regulation” will take effect, and no entity has yet obtained a license; it is expected that the first batch of licenses may welcome the first licensed institutions in early 2026. At the same time, the HKMA emphasizes that applicants should “apply early, communicate early, and be well-prepared”, communicate cautiously, and avoid creating unrealistic expectations. Therefore, for Web3 entrepreneurs, if you want to succeed, don't think about “cutting corners.” Institutional capital requires auditing, custody, and KYC, and will not invest in a “black box” project. If you are still stuck in the mindset of “running away when regulation comes,” then the future incremental market will have nothing to do with you.