Hong Kong’s Securities and Futures Fee (SFC) has launched the outcomes of its session paper on regulating crypto property within the nation. In an announcement on Might 23, 2023, the monetary watchdog stated it acquired 152 submissions from key gamers within the trade, skilled associations, and consultancy companies, greenlighting its proposal to permit licensed crypto exchanges to serve retail buyers within the nation.
The brand new improvement allows digital asset service suppliers (DASP) that reveal compliance with the brand new rulebook to use for licenses from the suitable authorities, whereas those that don’t plan to observe the SFC’s proposed directives are required to shut their enterprise dealings in Hong Kong.
Hong Kong’s New Crypto Tips to Develop into Efficient June 1
Though the brand new pointers are set to take impact beginning June 1, 2023, the upcoming regulatory framework will embody important facets, together with asset custody security necessities, avoidance of battle of curiosity, buyer asset segregation, and cyber safety requirements.
Whereas the regulator is but to approve any crypto buying and selling platform to offer its enterprise choices to retail buyers, crypto exchanges akin to Huobi International, OKX, and Gate.io have utilized to acquire digital property service supplier (VASP) licenses from the nation.
If permitted, the businesses can faucet Hong Kong’s crypto market to extend their consumer base and strengthen their footprints within the trade.
The choice by the SFC to permit licensed exchanges to function within the nation marks a big step in the direction of enhancing market integrity and constructing belief inside the area. By this transfer, Hong Kong has taken a step additional in the direction of attaining its aim of growing a digital asset hub and changing into a middle for technological improvements.
Defend Shopper Curiosity
Other than permitting crypto buying and selling platforms to function within the nation, the monetary regulator is dedicated to offering stringent measures to safeguard buyers whereas following the inputs from the outcomes of the session paper launched in February.
A few of the measures to be applied within the rulebook embrace good governance practices, making certain suitability throughout the onboarding course of, conducting enhanced token due diligence, setting admission standards, and selling disclosures.
In keeping with the SFC’s chief government officer, Ms. Julia Leung, the upcoming pointers for operators of digital asset buying and selling platforms align with the identical enterprise and rule regulatory measures that goal to offer sturdy investor safety and handle dangers.
“Offering clear regulatory expectations is essential to fostering accountable improvement. Hong Kong’s complete digital asset regulatory framework follows the ideas of ‘identical enterprise, identical dangers, identical guidelines’ and goals to offer sturdy investor safety and handle key dangers,” Leung stated.