Two-day summit reflects optimistic, rational mood over future of cutting-edge decentralized applications

Panelists share their views during the panel discussion titled “Decentralizing the Metaverse: Exploring the Multi-trillion Dollar Market Potential” at the WOW Summit 2023 on Wednesday. They are (from left) Ken Ip, chairman of the Asia MarTech Society; Alena Yudina, managing director of Quantum Leap Strategy; Cindy Zhang, executive director of Gobi Partners; Vincent Leung, global head of digital brand marketing at Lenzing Group; and moderator Frederik Hetsch, finance director of Lumiere. They were among over 150 speakers at the summit. (EDMOND TANG / CHINA DAILY)

Rather than generating a lot of hype about the blockchain-based third-generation internet (Web3), early adopters deep in the virtual universe — both investors and tech firms — have a pluckily enterprising, risk-taking but philosophical attitude spiked with a dose of rationality and cautious optimism. They dip a toe in the water, experimenting through trial and error in the metaverse laboratory, unfazed by any blips, because they sit and wait via a futuristic prism.

That’s a prevailing sentiment palpably percolating throughout the World of Web3 (WOW) Summit Hong Kong 2023, held on March 29-30 at the world-class AsiaWorld-Expo venue in Hong Kong. Attracting 5,000 attendees, including industry leaders, developers, startups, venture capital firms, corporates, and content creators, the WOW Summit served as a sounding board for Web3 players, where they could pick each other’s brains on Web3 adoption and regulation, non-fungible token (NFT) investment, blockchain technology and security, potential and challenges in the digital assets market, and content creation in the metaverse.

The flagship Web3 event was supported by InvestHK and the Hong Kong Tourism Board.

Underpinning Hong Kong’s potential for developing Web3 is a robust and well-regulated financial sector, said Joseph Chan Ho-lim, under secretary for financial services and the Treasury of the Hong Kong Special Administrative Region government, in his guest-of-honor speech.

As a leading international financial center in Asia, Hong Kong is in the driver’s seat when it comes to its standing across bonds and insurance, and asset work management in the region, he said.

He underlined the HKSAR government’s commitment to cultivating a flourishing Web3 ecosystem. In its latest budget, it announced that HK$50 million ($6.37 million) will be allocated to expedite Web3 development through, among other things, organizing major international seminars, to enable the industry and enterprises to better grasp frontier development and to promote cross-sectoral business cooperation. A task force will also be set up to direct the sustainable and responsible development of the emerging virtual-asset sector.

Guests listen intently to the speech by Joseph Chan Ho-lim, under secretary for financial services and the Treasury, during the WOW Summit 2023, a flagship Web3 event in the Asia-Pacific region. (EDMOND TANG / CHINA DAILY)

Steven Phillips, InvestHK’s director-general of investment promotion, applauded the Hong Kong Monetary Authority’s issuance of its consultation conclusion to the discussion paper on crypto assets and stablecoins, and its pledge to put in place a stablecoin regulatory regime by 2024.

That Hong Kong has its Web3 sensibilities under its belt, manifesting in its creative industry, boosts Phillips’ conviction that Hong Kong is poised to take the lead in Web3 adoption and applications. “Hong Kong is now one of the top three markets for auctioned art, and the Web3 solutions of technologies for verifying authenticity and provenance of artworks will further spur new developments,” Phillips said.

Bowie Lau, founder of MaGESpire, one of the event’s co-hosts, echoed Phillips’ sentiments. “Hong Kong has always treaded with cautious optimism when it comes to crypto and Web3 and has largely avoided the fallout from the crypto winter,” she said.

“But with an increasingly supportive regulatory stance and the open embrace of the metaverse, Hong Kong is positioned well to reclaim its leadership in the Web3 space.”

Avant-garde investors in Web3 cast their vision far and wide without fixating on the short-term rewards, in the knowledge that there’s still a long way to go before Web3 comes into full bloom — when the returns are expected to be mind-blowing.

“The metaverse of the future, 10 years forward, may not even be something that we can imagine today. Even up until recently, VR and AR (virtual reality and augmented reality) were ... still in their nascent stage as well,” said Cindy Zhang, executive director of Gobi Partners, an interconnected Pan-Asian venture capital firm, at a panel discussion on the topic “Decentralizing the Metaverse: Exploring the Multi-trillion Dollar Adler Potential”. Gobi Partners, based in Hong Kong and Kuala Lumpur, supports entrepreneurs, especially those in emerging markets, to raise funds.

“All these things take a lot of time to fully develop, but we are very open to being long-term committed, patient capital. What we are looking at is less from a short-term valuation perspective.”

More than 5,000 attendees from over 30 countries and regions gather in Hong Kong’s world-class AsiaWorld-Expo venue to discuss the hottest topics in Web3 and virtual assets and to harness business opportunities. (EDMOND TANG / CHINA DAILY)

While there’s much talk around the myriad benefits of decentralized digital ownership to the general public, the reality is that user adoption still leans more toward Web 2.0, Zhang said. The discourse currently has to be around how to bring the billions of people around the world onboard with Web3, she said. Web3 has to be a lot more “frictionless” before it becomes more inclusive, regardless of individuals’ tech savviness, she added.

The experimental mentality is also mirrored at Quantum Leap Strategy, a Swiss financial and management advisory firm that assists with company incorporation, new market entrance, and the positioning and digitization of assets. Revenues are not the core factor in the equation from an investment perspective, said Alena Yudina, the firm’s managing director. Nor should they be from the development perspective of those enterprises in which her company and others invest, she said. Now is an opportune moment for investors and companies to experiment and to test the water, as the metaverse and cryptocurrency are coming together with Web3 and exerting a substantial influence on the fintech ecosystem, which will become a lucrative mainstream market, Yudina said.

Ken Yip, chairman of Asia MarTech Society, a community that connects marketing technology players and industry stakeholders in Asia, said that to have a truly decentralized metaverse, no single company, government, platform or entity can control it, which means that all users and netizens are created equal in terms of accessing content, private data included, in the virtual space.

“Which means we need to encourage all these users to create content with you, and also to render content building easy, fun and rewarding, not just emotionally, but also financially, so that they are entitled to monetize their time and efforts,” Yip said.

The “virtual world” will be a game changer, Yip said. The metaverse emerges, at its core, as a virtual realm that allows people to interact without physical proximity, he said. “It’s made available to a lot of latest Web3 technologies, such as blockchain, VR, AR, ... and it is driven by cryptocurrency.”

Exhibitors dress up as characters from popular cartoons, reflecting the summit’s trend-following pace. (EDMOND TANG / CHINA DAILY)

According to Yip, there are five different domains where the metaverse can be harnessed and from which business opportunities can be derived: gaming, the workplace (or, more precisely, the hybrid work mode that developed during the COVID-19 pandemic), education, the crypto marketplace, and events.

“The metaverse allows us to create and reinvent an experience at a more advanced level” when it is curtailed under certain circumstances. For instance, the pandemic forced those in show business — one of the hardest-hit industries — to shift to performing online, and virtual concerts unexpectedly became a massive success, Yip said. They also promoted the sale of various merchandise such as posters, T-shirts, phone cases, NFTs and other digital assets with the help of the metaverse, he added.

After successful editions in Dubai in the United Arab Emirates, and in Lisbon, Portugal, the WOW Summit Hong Kong is now a flagship full-scale Web3 event in the Asia-Pacific region in 2023, along with WOW Hong Kong general partner OKX.

Lennix Lai, managing director of financial markets at OKX, said: “The Web3 community in Hong Kong is as vibrant as ever, perhaps less visible in recent years. That’s going to change quickly thanks to events like WOW Hong Kong, which will propel Hong Kong’s Web3 industry to the forefront once again by bringing leaders of all stripes together.”

Despite all the uncertainties in the post-pandemic era, a global transition from Web 2.0 to Web3, from centralized services to decentralized services, is surely happening.

“Hong Kong has reopened its borders and introduced a new vision of Web3 and virtual assets, welcoming tech companies from all over the world. I’m excited to bring the WOW Summit here to boost the transition to Web3; WOW things will happen here,” WOW Summit CEO Ivan V Ivanov said.

jenny@chinadailyhk.com