More blockchain companies set up shop in Hong Kong in 2019 than firms from any other fintech sub-sector, according to a report from the region’s Financial Services and the Treasury Bureau.

Representing 39% of the 57 fintechs that InvestHK, the government-owned inward investment advocate, wooed last year, blockchain outgrew the wealth tech, payments, cybersecurity, regulatory tech, credit tech and insurance tech sectors as Hong Kong’s foreign fintech relocation engine.

The growth figures depict a region savvily courting firms across the blockchain and cryptocurrency ecosystem. Since 2018, authorities have offered immigration incentives to blockchain job seekers, launched a blockchain trade finance platform and brokered industry ties. 

Those efforts appear to be paying off in more ways than one. Hong Kong had four times higher than average demand for blockchain professionals in a 2019 LinkedIn report, which ranked blockchain as the region’s top rising skill set. 

Diversity in blockchain focus

Hong Kong’s heightened interest in blockchain jobs and firms spreads across the industry, the Treasury report shows. 

Of 2019’s newcomer blockchain firms, 45% were enterprise blockchain companies, 27% built digital asset trading platforms, 14% were digital asset custodians and 9% focused on trade finance settlement.

An additional 5% were “exploring the area of security tokens” according to the Treasury report. That cautious wording may be a function of security tokens’ nascent regulatory status. Hong Kong’s financial regulator issued guidance on security tokens in March 2019 and rules for the exchanges that trade them in November.

See also: Hong Kong’s First Regulator-Approved Bitcoin Fund Targets $100M Raise

But the Securities and Futures Commission’s trading platform rules are only an “interim solution,” according to the report. It called for legislative action on the matter.

Blockchain firms represented 27% of InvestHK’s newcomer fintechs in 2018, the report said. 

Hong Kong has continued to attract crypto ventures and investments in 2020, including capital from institutional players. In February, Fidelity International invested $14 million in the company running crypto exchange OSL, which is based in Hong Kong.

More growth is likely on the way. Cyberport, a government-owned fintech business park and partner to Hyperledger, plans to keep fostering its blockchain cluster, according to the report.