• Hong Kong’s SFC is releasing crypto license guidelines in May to better clarify its digital currency sphere.
• The guidelines will address trading, custody, and issuance of digital assets.
• Several cryptocurrency exchanges and related businesses are already operating in Hong Kong but the lack of clear regulations has been an issue.
Hong Kong To Issue Crypto Guidelines
Hong Kong’s Securities Futures Commission (SFC) announced that it is releasing crypto license guidelines in May to better clarify its digital currency sphere, a development that has been in the pipeline for a while now. According to the reports, the guidelines will address various matters regarding trading, custody, and issuance of digital assets. The announcement comes as Hong Kong seeks to position itself as a leading hub for the cryptocurrency industry in Asia.
SFC CEO’s Statement
SFC’s CEO, Julia Leung, noted in the report that the anticipated guidelines would facilitate the trading services of crypto platforms beginning from June 1. It will provide a clear framework for companies seeking to operate in the cryptocurrency space in Hong Kong. This could include anti-money laundering (AML) requirements and know-your-customer (KYC) procedures.
Licensing Regime Reception
Leung said in the report that the licensing regime has already gained more than 150 responses from interested parties. Also, some trading platforms have already begun offering digital asset services to investors under the supervision of the Securities Futures Commission. Notably, Reuters revealed Hashkey Group and OSL, among the trading platforms, have already obtained their licenses from the commission. However, some prospective Virtual Asset Service Provider (VASP) licensees still await confirmation from the SFC.
While Hong Kong seeks to be Asia’s next digital asset hub, some crypto platforms have decided to end their operations in the city. On April 24th , Bitget , a digital currency exchange with over $1 .4 billion worth of assets in its custody , reported that it would no longer offer cryptocurrency services in Hong Kong after June 1st .
Regulatory Environment Development
Hong Kong has long been committed to creating a favorable environment for the crypto industry . In October 2022 ,the Hong Kong government announced plans to develop a regulatory framework which would enable financial institutions like banks and brokerages to offer custodial services for cryptocurrencies . The framework also aims at improving consumer protection and ensuring proper compliance with AML/CFT regulations