Hong Kong to adapt crypto regulations to evolving industry

Hong Kong’s monetary regulators are ready to regulate their method to cryptocurrency regulation because the trade develops, in keeping with Finance Secretary Christopher Hui.

Speaking at a parliamentary session, Hui said that the Hong Kong Financial Authority (HKMA) and the Securities and Futures Fee (SFC) would contemplate market traits when devising rules. He stated:

The HKMA and the SFC will hold in view market developments, and evaluate the necessities on VA-related actions as acceptable.

Hui’s feedback got here in response to questions on probably expediting the crypto licensing course of and easing guidelines for intermediaries distributing crypto belongings. He clarified that licensed firms and registered establishments can distribute crypto-related merchandise after notifying regulators, without having to switch their licensing situations.

This dialogue follows the withdrawal of license purposes by a number of main global crypto exchanges, together with OKX, Gate.io, and HTX, forward of a June 1 deadline set by the SFC. After this date, all crypto buying and selling platforms working in Hong Kong have to be both licensed or “deemed-to-be-licensed” candidates.

The stringency of Hong Kong’s licensing rules has drawn criticism from some quarters. Lawmaker Duncan Chiu expressed considerations that overly strict guidelines have deterred main international exchanges from getting into the Hong Kong market. In a recent opinion piece, Chiu argued that these withdrawals have undermined confidence in Hong Kong’s efforts to determine itself as a Web3 hub.

Hong Kong’s crypto panorama

Hong Kong approved the launch of six spot Bitcoin (BTC) and Ethereum (ETH) exchange-traded funds (ETFs) again in early Could. The merchandise in query have been issued by China Asset Administration (ChinaAMC), Bosera Asset Administration, and Harvest International Investments and permit publicity to crypto with out technical experience.

Earlier this month, Banque de France (BDF) and the Hong Kong Financial Authority additionally signed a memorandum of understanding on bilateral collaboration on wholesale central financial institution digital forex and tokenization growth. The 2 regulators are keen to discover interoperability between their digital currencies and cross-country transactions.