Hong Kong’s Securities and Futures Fee (SFC) issued a directive earlier immediately for all crypto buying and selling platforms working inside its jurisdiction. The directive obliges these platforms to submit a allow software earlier than February 29, in any other case they are going to be closed earlier than Might 31.
This announcement is a part of Hong Kong’s ongoing efforts to ascertain a regulated regional setting for digital asset buying and selling. It displays a worldwide pattern in the direction of larger scrutiny within the crypto business.
Navigating the brand new crypto regulatory panorama
Because the deadline approaches, the SFC has ensured that traders are properly knowledgeable and ready. In an announcement posted within the early hours of Monday, the committee suggested traders to make sure they solely take care of platforms listed as licensed digital asset buying and selling platforms or as candidates for the license.
Moreover, the committee really useful that traders buying and selling on unlisted platforms take early motion, equivalent to closing their accounts, to keep away from potential disruptions. The SFC famous within the announcement:
For traders coping with Digital Asset Buying and selling Platforms (VATPs) working in Hong Kong and NOT listed on the “Record of licensed digital asset buying and selling platforms‘or on the “Record of candidates for a digital asset buying and selling platform” (…), they’re urged to make early preparations earlier than Might 31, 2024, for instance by closing their accounts with these VATPs or switching to VATs with an SFC license for buying and selling digital belongings.
Solely two platforms, HashKey and OSL, have been granted licenses by the Hong Kong regulator. In the meantime, Hong Kong’s SFC is processing license functions from 14 crypto entities.
This checklist consists of outstanding business gamers equivalent to Bybit and OKX and crypto trade HKVAEX, which reportedly has connections to Binance.
Hong Kong’s broader regulatory technique
This strict licensing course of seems to be a part of Hong Kong’s broader technique to control the crypto market in its area. Not too long ago, the area introduced plans to introduce a brand new regulatory framework specializing in over-the-counter (OTC) crypto buying and selling platforms.
Christopher Hui, Minister of Monetary Providers and the Ministry of Finance, underlined the necessity for this regulation, particularly in gentle of a number of fraud circumstances involving unlicensed digital asset buying and selling platforms.
As laws tighten, Hong Kong stays dedicated to ‘selling’ a crypto-friendly setting, with ambitions to change into a number one digital asset hub within the Asia-Pacific area. This balancing act is clearly mirrored within the area’s latest transfer to open doorways for functions for spot exchange-traded funds (ETFs).
Harvest Fund Hong Kong, a serious Chinese language fund firm, has already filed for a Bitcoin spot ETF, marking a milestone within the area’s crypto journey. Reviews point out that the SFC is contemplating accelerating the spot ETF authorization course of.
The intention is to checklist the corporate on the Hong Kong Inventory Trade shortly after the Chinese language New Yr celebrations, probably as early as February 10.
Featured picture from Unsplash, chart from TradingView
