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- Hong Kong said no to retail traders on June 1, let’s have a look at what the nation holds for the crypto community in that period.
- Leo Weese, co-founder of Bitcoin Association of Hong Kong, said that outside firms will go through strict licensing regimes.
As Hong Kong continues to set up a foundation for crypto development, along with the license regime for Virtual Asset Service Providers (VASP). Citizens of the city were wrong about crypto being “full legal” for everyone.
Hong Kong focuses on crypto regulations
The need for VASP approval for licensing crypto exchanges, allows only professional investors, while excluding retail investors. The Hong Kong authorities too pointed out that major securities institutions, the Securities and Futures Commission (SFC). Also, it is the frontline regulator of listing cases, including approving listing and overseeing listed firms, according to its official website.
According to media reports, the SFC is working to figure out which cryptocurrencies should be presented to retail investors and which not. Most probably in the array belongs “highly liquid” assets and options will be very concentrated initially, said SFC CEO Julia Leung. The date June 1 is noted specifically, with Brand Hong Kong (BrandHK) in faith to promote the city as Asia’s world city.
Bitcoin Association of Hong Kong co-founder, Leo Weese wrote in a post dating back in May 2021: “For those platforms operated outside of Hong Kong, we see little incentive to incorporate in Hong Kong, establish an office here, go through the strict licensing requirements, as the local market of is small. Local institutional investors will be able to interact with foreign platforms through their foreign subsidiaries.”
“Whether foreign platforms continue to offer their services to Hong Kong retail clients remains to be seen, though we see little incentive for them not to. To compete in a global market, Hong Kong-based platforms might be compelled to leave and establish operations elsewhere,” he added.
The retail investors are also restricted from using regional Hong Kong entities for the purpose of trading. Although, investors are exempted from capital gains tax in Hong Kong. Looking nearer in Asia, Japan adaptive regulations helped the nation to shield to some extent from FTX crash tremors that wiped out billions from the entire crypto industry. Also, the country is working on more helpful guidelines and policies for DAOs, stablecoins and NFTs.
After the Sam Bankman-Fried led crypto exchange FTX collapsed in November 2022, South Korea, Singapore and Japan were among the top three adversely affected nations. The famous Japanese investment conglomerate SoftBank investmed nearly $400 million in the defunct firm, according to a news website.
How do officials view it?
According to media reports, Hong Kong Secretary of Financial Services and the Treasury (FSTB), Christopher Hui, said in past month interview that “We’re able to bring together investments globally,” he also added “We can manage and also channel these investments in a well-regulated and also sustainable manner.”
Andrew is a blockchain developer who developed his interest in cryptocurrencies while pursuing his post-graduation major in blockchain development. He is a keen observer of details and shares his passion for writing, along with coding. His backend knowledge about blockchain helps him give a unique perspective to his writing skills, and a reliable craft at explaining the concepts such as blockchain programming, languages and token minting. He also frequently shares technical details and performance indicators of ICOs and IDOs.
