Hong Kong Investors Launch $100M Fund for Web3 Startups

Hong Kong is once again opening up to the crypto market, as local investors launch a $100 million fund to finance the digital industry. The new fund, ProDigital Future, will focus on supporting early-stage Web3 companies oriented at the regional market.

According to a Bloomberg report from March 30, ProDigital Future has completed its half-year fundraising period with about $30 million in its pockets. However, it aims to raise $100 million by the end of 2023. The fund is led by Ben Ng, a partner at Hong Kong-based equity firm SAIF Partners, and Curt Shi, a long-time tech investor from China. Sunwah Kingsway Capital Holdings and Golin International Group have already invested in the fund.

Shi, the co-leader of ProDigital Future, told journalists that the fundraising process has been “relatively smooth,” although the investors are cautious about putting their money into crypto projects. ProDigital Future has attracted Hong Kong investors, as well as some family offices from China, Australia, and Singapore.

The fund aims to “embrace Hong Kong and its policies” while expanding its reach to Australia, Singapore, Europe, and the United States. ProDigital Future has already invested in six digital-asset projects, including metaverse company GigaSpace and One Future Football, a digital football league from Australia currently operating in stealth mode.

The launch of ProDigital Future comes amid growing regulatory efforts to oversee the crypto market in Hong Kong. In October 2022, the government of Hong Kong floated the idea of introducing its own bill to regulate crypto. On Feb. 20, Hong Kong’s Securities and Futures Commission released a proposal for a licensing regime for cryptocurrency exchanges, set to take effect in June.

The proposed licensing regime includes a necessary licensing procedure, demanding that potential market players meet several prerequisites, including the safe custody of assets, Know Your Customer, Anti-Money Laundering, and Combating the Financing of Terrorism regulations.

Despite these regulatory efforts, the launch of ProDigital Future signals a growing interest in the potential of the crypto market in Hong Kong and the wider Asia-Pacific region. With a focus on Web3 startups and a commitment to regulatory compliance, the fund aims to support the growth and development of the digital industry in the region.