Edith Yeung Envisions a Bright Future for Cryptocurrency in Hong Kong

As the co-founder and managing partner of the early-stage venture capital firm, Race Capital, Edith Yeung has witnessed the evolution of the cryptocurrency sector firsthand, particularly in her native Hong Kong. Notably, she was an early seed investor in Solana, investing $250,000 when SOL was valued at just $0.04, and also invested in the Lightning Network. Since 2017, Yeung has been authoring the influential China Internet Report, an annual survey of technology trends in China. In this conversation, Yeung, who will be speaking at Consensus Hong Kong, shares her insights on Hong Kong's ongoing development as a cryptocurrency hub, China's stance on cryptocurrency, her predictions for Solana, and a major cryptocurrency forecast for 2025. This series is presented by Consensus Hong Kong, the premier event for Web3 and digital assets, taking place from February 18-20. Register now and receive a 15% discount with the code CoinDesk15. The interview has been condensed and lightly edited for clarity. Yeung begins by discussing the development of cryptocurrency regulations in Hong Kong, stating that the presence of seven SFC-licensed virtual asset trading platforms is a significant step forward for investors. However, she emphasizes that licensing alone is insufficient, and that building liquidity is crucial for the growth of the cryptocurrency market in Hong Kong. Yeung likens a trading platform to a newly constructed highway, noting that even with the best infrastructure, a lack of traffic will deter investors. She believes that Hong Kong's key challenge is to build not only the infrastructure but also the traffic flow, as a great platform without liquidity is akin to an empty highway. Yeung also discusses Hong Kong's role in the cryptocurrency sector, particularly in relation to the US and Asia. She describes Hong Kong as the 'New York of Asia,' with Exchange Square being comparable to Wall Street, and notes that the city boasts a rich financial history, with a deep pool of experienced professionals who can drive innovation and growth in the venture capital sector. When asked about the distinctive aspects of Hong Kong and Southeast Asia for cryptocurrency compared to the US and Europe, Yeung highlights that while the US has the largest addressable market for institutional investors, regulators, and builders, Asia has the highest growth potential for the cryptocurrency market. She notes that in 2024, half of the top 10 countries ranked by cryptocurrency adoption were located in Asia. Yeung also shares her views on China's stance on cryptocurrency, stating that while the government is officially against mining and speculation, the formation of pro-cryptocurrency regulations in Hong Kong is a positive indicator for China. She notes that China has a vast army of 220 million retail investors with almost $21 trillion in savings, but the government's focus on addressing the property crisis and economic issues may delay the opening up of the cryptocurrency market. As a seed investor in Solana, Yeung still holds her initial investment and believes that Solana will continue to attract significant activity, driven not only by memecoins but also by its dedication to building and supporting the developer community. She is excited about the technical advances made by the Firedancer team and the involvement of traditional finance players like Fidelity, Citi, and PayPal in building on Solana. Yeung is currently looking to invest in companies that are building internet infrastructure, such as Huma Finance, a leader in PayFi and stablecoin infrastructure. She predicts that the establishment of a US Bitcoin Reserve by the end of 2025 will drive up bitcoin prices and prompt other governments to follow suit. Onstage in Hong Kong, Yeung is most excited to discuss Hong Kong's role in building the cryptocurrency industry, China's complex relationship with cryptocurrency, and her insights on Solana.