The cryptoasset industry in Singapore and Hong Kong

抄録

Since Bitcoin's inception in 2009, an industry has emerged comprising companies whose core business operations revolve around cryptoassets. Key actors in this industry include centralised exchanges, such as Binance and Coinbase; entities behind permissionless blockchains like Ethereum and Solana; and decentralised applications such as Aave and Uniswap. Economic geographers have increasingly focused on phenomena related to cryptoassets and their underlying distributed ledger technology (DLT), with forthcoming special issues in Finance and Space and Progress in Human Geography addressing decentralised finance (DeFi) and spatial implications of blockchain technology, respectively. However, existing research on the geography of cryptoassets has not examined these actors as members of a cohesive industry. This gap is significant because engagement in cryptoasset-related phenomena, including DeFi, Decentralised Autonomous Organisations (DAOs), and nonfungible tokens (NFTs), requires specific cryptoassets and DLT knowledge, suggesting these actors belong to a distinct epistemic community (Haas, 1992; Punstein and Glückler, 2020). The cryptoasset industry maintains multiple linkages with traditional finance (TradFi), particularly through DLT's capacity for digital asset tokenisation, which could transform the finance industry. This relationship holds particular significance for established financial centres. Given the importance of Singapore and Hong Kong as financial centres, this research seeks to elucidate the role of geographic embeddedness in shaping the development of the cryptoasset industry. Through a comparative case study of Singapore and Hong Kong, drawing on interviews with managers in the cryptoasset industry, this study identifies and analyse spatial factors that has shaped the industry in the two cities, e.g., proximity to talents and capital. By incorporating spatial considerations, the study provides a more nuanced understanding of the development of a nascent industry. The study contributes to the ongoing debate on the geography of the firm, specifically the subfield of management geography (Schlunze et al., 2011; Suwala et al., 2022), by offering a nuanced theoretical understanding of how geographic embeddedness shapes industry development.

References

Haas, P. M. (1992). Introduction: epistemic communities and international policy coordination. International Organization, 46(1), 1–35. https://doi.org/10/cwcwv2

Punstein, A. M., and Glückler, J. (2020). In the mood for learning? How the thought collectives of designers and engineers co-create innovations. Journal of Economic Geography, 20(2), 543–570. https://doi.org/10/ggth8s

Schlunze, R. D., O Agola, N., and W Baber, W. (Eds.). (2011). Spaces of International Economy and Management. Palgrave Macmillan.

Suwala, L., Pachura, P., and Schlunze, R. D. (2022). Management Geography - Making Place for Space in Management Thought. Polish Journal of Management Studies, 25(2), 323–340. https://doi.org/10/g75wxh