Bitcoin Updates: Hong Kong's Cryptocurrency Regulations Ignite Clash Between Digital Assets and Conventional Banking

Jenny Johnson, CEO of Franklin Templeton, has highlighted the cryptocurrency industry as a powerful catalyst for change that is set to challenge conventional finance, reflecting a broader movement in the sector toward integration and innovation. During her address at Hong Kong Fintech Week 2025, Johnson redefined the dynamic between digital assets and established financial institutions, describing the shift from "two parallel universes" to an environment where both are increasingly intersecting, as noted by

. The growing embrace of blockchain by institutions and the transfer of assets onto these networks are speeding up this convergence, with being recognized as a "digital gold" that particularly appeals to younger generations, according to . Johnson pointed out that Franklin Templeton is actively tracking these shifts, expecting a surge of innovative crypto business models that could foster the next wave of industry frontrunners, alongside advancements in AI.

Her comments reflect a wider sense of optimism in the market, such as Michael Saylor’s recent assertion that Bitcoin could climb to $150,000 by the end of 2025, as covered by

. This outlook comes after a turbulent period for digital assets, with $470 million withdrawn from Bitcoin ETFs and ongoing uncertainty regarding U.S.-China trade tariffs. Meanwhile, Standard Chartered forecasts that tokenized real-world assets (RWAs) could reach a $2 trillion valuation by 2028, highlighting blockchain’s capacity to transform legacy finance.

Hong Kong is emerging as a key player in this transformation. The city’s Securities and Futures Commission (SFC) has introduced new regulations permitting licensed crypto exchanges to tap into global liquidity pools, a step intended to enhance trading performance and market competitiveness, as reported by

. SFC head Julia Leung stated that these updates, revealed at Fintech Week 2025, are designed to bring Hong Kong in line with international norms while safeguarding investors. The new policy allows local exchanges to connect with worldwide order books, removing previous barriers that confined trading to domestic platforms. Additionally, the Hong Kong Monetary Authority (HKMA) has released a "Fintech 2030" strategy that prioritizes tokenization, artificial intelligence, and blockchain infrastructure, signaling the city’s intent to become a leader in digital assets, according to the .

These regulatory advances are already drawing major industry participants.

, for example, announced a 25% rise in revenue for the third quarter of 2025, fueled by Bitcoin’s rally and greater institutional involvement, as noted by . The company’s growth in derivatives and institutional offerings, along with its acquisition of Deribit, led to a 122% year-over-year increase in transaction revenue. Likewise, Belgravia Hartford Capital has expanded its Bitcoin reserves, purchasing BTC through corporate credit lines and convertible bonds, demonstrating rising corporate trust in crypto as a treasury asset, as reported by .

Nevertheless, the sector still faces hurdles. Recent volatility, including a $19 billion drop in crypto markets and dYdX’s $462,000 compensation plan for impacted traders, underscores the risks involved. Still, experts believe that clearer regulations and greater institutional engagement—highlighted by BlackRock’s leadership in Bitcoin ETF inflows—are essential for lasting stability.

As the digital asset space continues to develop, Johnson’s outlook for a "new business model" reshaping finance is becoming more tangible. With Hong Kong’s regulatory progress, institutional momentum, and technological innovations like tokenized RWAs and staking ETFs, the merging of crypto and traditional finance is not only possible but rapidly unfolding.