Hong Kong authorities seek to regulate crypto trading platforms.

Hong Kong authorities seek to regulate crypto trading platforms operating in the financial hub, the city's markets watchdog said on Tuesday.

Financial regulators around the world are still assessing whether and how they should regulate the cryptocurrency industry. Investor protection and preventing money laundering are particular concerns. Other financial centers in Asia, such as Japan and Singapore, have licensing regimes that require all cryptocurrency trading platforms to be regulated. In contrast, while Hong Kong’s Securities and Futures Commission launched a regulatory framework specifically for cryptocurrency trading platforms last year, this was restricted to those platforms that traded an asset officially classed a security or future, not just tokens like bitcoin, Reuters reported.

 

Hong Kong government to propose a new licensing regime today under its AML legislation. 

Ashley Alder, chief executive of the SFC, said in a speech on Tuesday, “this is a significant limitation, as under the current legislative framework if a platform operator is really determined to operate completely off the regulatory radar, it can do so simply by ensuring that its traded crypto assets are not within the legal definition of a security. Consequently, the Hong Kong government plans to propose a new licensing regime today under its anti-money laundering legislation, requiring all cryptocurrency trading platforms that operate there, or target investors in the city, to apply for an SFC license, Alder said. 

 

The SFC has not issued a full license to any crypto exchange. 

Dozens of cryptocurrency exchanges operate in Hong Kong, including some of the world’s largest, though many chose not to apply for a license under the existing regime. The SFC has not issued a full license to any crypto exchange but has agreed in principle to issue a license to cryptocurrency firm OSL Digital Securities, a unit of Fidelity-backed BC group 0863.HK, OSL said in August.

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Jai Pratap
Jai Pratap
A Mass Media Graduate who loves to write. Jai is also a sports enthusiast and a big movie buff. He loves to learn new things.

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