Categories: Cryptocurrency News

Hong Kong unveils 17 crypto hopefuls amid new rules

As of June 1, the Securities and Futures Commission (SFC) of Hong Kong regulates the VATPs with enhanced standards for the latter. Among these regulations, one of the critical regulations stated that only companies holding an SFC license can engage in VATP business within or regarding investors in Hong Kong. The SFC has also said in its previous statements that particular VATP applicants can be deemed licensed if they fulfill certain conditions outlined in the statements. In general, this new set of rules is designed to enhance the security of the virtual asset trading process in Hong Kong.

These changes in the regulations aim to enhance the protection of investors and ensure fairness in the market. According to the SFC, VATPs must meet stringent requirements, including submitting a detailed application indicating their management experience, relevant educational background, and third-party reports that affirm that the platform meets the legal requirements. Additionally, they provide particular instructions on token inclusion, the prohibition of money laundering, and the ban on proprietary trading. It is also necessary to ensure adequate insurance coverage or compensation methods in case of loss or damage to assets.

OSL Digital Securities Ltd. (OSL Exchange) and Hash Blockchain Ltd. (HashKey Exchange) are the only players who have received the necessary SFC licenses to operate as Virtual Asset Trading Platforms (VATPs) in Hong Kong, alongside the new regulations implemented. This limited number speaks volumes about the strict nature of these regulations and the challenges other platforms face to meet these compliance measures.

In light of this, and to enhance accountability and support investor decisions, the SFC has released the list of applicants for Crypto trading platforms. This list includes organizations that still need to secure licenses and may not operate according to the set rules and regulations. The SFC emphasizes that investors should independently verify the licensing of such platforms and exercise caution when dealing with unlicensed or provisionally licensed entities. Currently, these platforms are likely to face closure if they adhere to regulatory requirements within the near future.

Hong Kong BGE Ltd., Hong Kong Digital Asset EX Ltd., and Hong Kong Virtual Asset Exchange Ltd. are some applicant firms. They represent a diverse pool of firms interested in participating in the regulated crypto space in Hong Kong. The market also contains entrants like Panthertrade (Hong Kong) Ltd. and Accumulus GBA Technology (Hongkong) Co. Ltd., trying to navigate the complex legal structure.

Due to new regulatory measures, many large exchange platforms intend to cease their activities in Hong Kong. Some of these include Okx and Gate.hk, which attributed the strict regulations to their withdrawal from the market. This development shifts the landscape of the virtual asset industry in Hong Kong and demonstrates the role of regulation in structuring the operations of crypto exchanges.

The evolution of the virtual asset sector shows that regulation works alongside innovation in regulating these technologies. It is important to note that this is an ongoing process that does not only affect the participants in local Austrian companies but could also set a precedent that will influence the international regulation of cryptocurrencies in the future.

Erica Lee

Erica is a finance professional who has over a decade of experience in the finance sector as a management consultant. After years of reporting on forex, stock markets, and finance, she now contributes her strong financial skills with the CoinNewsSpan team. Since 2014, she has been deeply involved in the blockchain and cryptocurrency space. She believes that blockchain technology has tremendous potential to make our lives better.

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Erica Lee