Hong Kong is setting aside HK$50 million (US$6.37 million) to develop its Web3 industry, Financial Secretary Paul Chan announced during the city state's annual budget speech on Wednesday.
According to Chan, the funds will be used to organise major international seminars, enable the industry and enterprises to better understand frontier development, and promote "cross-sectoral business co-operation", among others.
"The third generation Internet (Web3), currently in its start-up period, has the same huge potential. We must keep up with the times and seize this golden opportunity to spearhead innovation development," Chan said.
"For the next step, I will establish and lead a task force on VA development, with members from relevant policy bureaux, financial regulators and market participants, to provide recommendations on the sustainable and responsible development of the sector," he added.
The latest announcement comes just a day after the special administrative region introduced a proposal to allow retail access to cryptocurrency.
Read more: Hong Kong Proposes Plan for Retail Access to Crypto
According to a consultation paper published by the Hong Kong Securities and Futures Commission (SFC) on Monday, retail investors will be able to access large cap crypto tokens.
The plan, which will be put forward for a period of six weeks to receive feedback from "interested parties," also stipulates that retail customers are required to pass a knowledge assessment or else only be offered access after training is provided.
The SFC also announced that all digital asset trading platforms operating in Hong Kong or actively marketing to Hong Kong-based investors are required to be licensed.
Hong Kong's recent regulatory developments have been seen by the industry as a welcoming hand, with both institutional and retail-facing crypto companies eager to set up shop in the city state.
Last week, DBS, the largest bank in Southeast Asia, announced that it is seeking the license that would permit it to offer crypto trading to Hong Kong customers.
Read more: OSL Inks Interactive Brokers, Arta TechFin Deals to Further Hong Kong's Crypto Access