The Hong Kong government is now concentrating on decentralized finance (DeFi) and metaverse technologies to bolster its global fintech reputation.

Recent insights from the Hong Kong Institute for Monetary and Financial Research (HKIMR), the research arm of the Hong Kong Academy of Finance (AoF), back this strategic shift.

According to the HKIMR report, the DeFi sector has seen remarkable growth, with its market capitalization surging from $6 billion in 2021 to over $80 billion in 2023. Despite this rapid expansion, DeFi still accounts for only 4% of the overall crypto-asset market. The report indicates that over 70% of crypto businesses have yet to fully explore DeFi’s potential.

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The report also highlights the challenges DeFi faces, such as governance, compliance, and security issues. However, it remains hopeful about DeFi’s ability to offer innovative financial services. These services can increase automation and financial inclusion, making them a significant component of future financial systems.

Metaverse Engagement Among Financial Institutions

Another report from HKIMR delves into the metaverse, showing a moderate level of engagement from Hong Kong’s financial institutions. Despite the interest, more than half of the respondents (51%) expressed doubts about the metaverse’s future potential. Nonetheless, certain segments of Hong Kong’s fintech sector are actively exploring metaverse-related developments, signaling a growing recognition of its potential.

Enoch Fung, CEO of the AoF and executive director of the HKIMR, commented on the integration of emerging technologies with financial services.

“The emerging technologies of DeFi and the metaverse, which are closely connected to the broader virtual asset and Web3 developments, will likely present various opportunities for the financial services industry in Hong Kong.”

Promoting Hong Kong in the International Tech Scene

Hong Kong officials are actively promoting the city as a premier destination for fintech and Web3 startups. They participated in the Collision 2024 tech conference in Toronto, highlighting Hong Kong’s readiness to serve as an offshore technology hub for Canadian crypto and Web3 businesses. This event was co-hosted by the Hong Kong Economic and Trade Office in Toronto (Toronto ETO), Invest Hong Kong (InvestHK), and StartmeupHK (SMUHK).

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Despite its efforts to position itself as a crypto-friendly hub, Hong Kong has seen a series of crypto exchange closures. In March 2024, HKVAEX, allegedly linked to Binance, withdrew its license application. This was followed by the exits of IBTCEX, QuanXLab, Huobi HK, Gate.HK, OKX HK, and Bybit (Spark Fintech Limited) in May. As a result, 17 virtual asset trading platforms remain on the application list, with 11 companies withdrawing or returning their license applications.

The withdrawal of license applications has sparked concerns about Hong Kong’s cryptocurrency licensing system. Hong Kong Legislative Council member Wu Shuo has publicly criticized the system, claiming it undermines market confidence. These recent closures and withdrawals underscore the challenges crypto businesses face in navigating Hong Kong’s regulatory environment.

Source: coinfomania.com

The post Hong Kong Boosts Fintech Scene with Focus on DeFi and Metaverse appeared first on HIPTHER Alerts.

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India’s automobile sector has recently seen a surge of incentives aimed at attracting investment, increasing capital expenditure, and boosting domestic value addition in auto manufacturing. These policies, which include tariff reductions, duty waivers and concessions, production-linked incentives, and consumer subsidies, also bring statutory liabilities, increased regulation, and heightened oversight.

This comes amidst rising reports of manufacturing defects. Between 2012 and 2023, India documented over 5 million “moderate to serious” incidents, primarily involving fossil fuel-dependent vehicles. More recently, incidents involving electric vehicle (EV) motors catching fire have raised concerns about the safety, suitability, and adequacy of stress testing new technologies for India’s climatic and driving conditions.

Regulatory Interventions and Their Impact

Key regulatory measures include a new product liability regime with significant implications for original equipment manufacturers (OEMs) and other stakeholders in the value chain, such as component suppliers, dealers, distributors, and service providers. Significant developments include updated technical standards in manufacturing, enhanced safety norms for vehicles, and the empowerment of governmental authorities to initiate investigations, impose penalties, and order product recalls.

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The Motor Vehicles (Amendment) Act, 2019 (MVA), authorizes a designated authority to recall vehicles when a defect affects the product safety of a specific number or percentage of annual sales. The MVA permits designated officers to inspect manufacturers’ premises and review records and procedures. Non-compliance with manufacturing specifications, technical standards, and safety norms can lead to vehicle recalls and penalties. The MVA holds directors and officers vicariously liable for the company’s actions, including non-executive directors who approve contravening acts through board decisions.

Enhancing Safety and Consumer Protection

While the MVA enhances manufacturing safety, the Consumer Protection Act, 2019 is consumer-focused legislation addressing product liability. It shifts the burden of proof from the consumer to the manufacturer and seller to disprove liability for specified defaults.

Implications for OEMs and Component Manufacturers

These regulatory changes require OEMs to certify that new vehicles meet improved technical standards and safety norms, involving additional testing, mandatory anti-hazard safeguards, smart management systems to prevent overcharging and short circuits, and comprehensive warranty support.

Japanese companies, among others, must note that OEMs and component manufacturers are subject to presumptive liability. The regulatory amendments necessitate OEMs to review and update product testing and commissioning processes, enhance compliance, conduct audits, and perform thorough vehicle risk assessments. Manufacturing processes must be thoroughly documented. OEMs must ensure adherence to safety norms, pre-certification, and warranty coverage, while drafting carefully worded liability management provisions in supply contracts to apportion statutory liability and costs to component manufacturers and other parties.

To mitigate product liability, OEMs should implement comprehensive and robust quality controls and testing measures throughout the manufacturing lifecycle. Third parties should conduct testing and validation, and OEMs must maintain detailed records to demonstrate due diligence and transparency. With statutory powers allowing for investigations, document reviews, and procedure recordings, OEMs must prepare for business disruption risks and potential breaches of confidentiality.

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Strategic Recommendations

OEMs should regularly audit suppliers and track parts to identify defective vehicles, facilitating the assignment of liability and costs. Board procedures must be rigorous, ensuring nominees fulfill their fiduciary duties. Insurance policies must cover product liability and recall.

OEMs should develop clear escalation procedures and crisis management plans, and establish robust contracts with suppliers and partners that include warranties, indemnities, and allocated responsibilities.

Cost Implications

In the near term, these measures may increase manufacturing costs in India. Given India’s highly competitive and price-sensitive market, OEMs might find it challenging to pass these costs onto consumers.

Source: law.asia

The post Auto industry product liability and recall appeared first on HIPTHER Alerts.

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A recent study by Jumio, an AI-driven identity verification and compliance solutions provider, has revealed that 78% of consumers in Singapore are prepared to switch banks due to insufficient fraud protection.

The Jumio 2024 Online Identity Study highlights the increasing concern among consumers about their banks’ ability to protect them from fraud. The study found that 75% of consumers globally, and 78% in Singapore, would consider changing their banking provider if fraud protection was inadequate.

Surveying over 8,000 adults across the United Kingdom, United States, Singapore, and Mexico, the study reveals that 75% of consumers hold their banks ultimately responsible for safeguarding against cybercrime and fraud.

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The rising sophistication of fraud tactics, such as deepfakes and voice cloning, has intensified these concerns. Deepfake technology, in particular, is being used more frequently to deceive consumers into divulging sensitive information, significantly contributing to their anxiety.

In Singapore, 78% of respondents are especially concerned about their bank’s efforts to combat deepfake-powered fraud, compared to the global average of 67%. Additionally, 74% of Singaporeans call for stronger cybersecurity measures, surpassing the global average of 69%.

The expectation for financial institutions to provide robust fraud protection is increasing, with three-quarters of consumers expecting a full refund if they become victims of cybercrime.

Source: fintechnews.sg

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