The Hong Kong Securities and Futures Commission (SFC) is calling for public feedback on its new proposals to regulate the crypto industry set to take effect starting in June, according to a Monday press release.
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Fast facts
- The public consultation will collate feedback on investor protection measures and whether licensed exchanges should be allowed to serve the city’s retail investors.
- “In light of the recent turmoil and the collapse of some leading crypto trading platforms around the world, there is a clear consensus among regulators globally for regulation in the virtual asset space to ensure investors are adequately protected, and key risks are effectively managed,” said SFC CEO Julia Leung.
- The proposed regulatory guidelines are based on existing traditional finance laws and would require any person or business providing cryptocurrency-related services to apply for a license from the regulatory body.
- Cryptocurrency exchanges and service providers would also be required to meet higher standards on safe custody of assets, know-your-client practices, conflicts of interest, cybersecurity, accounting and auditing, risk management, and anti-money laundering.
- Hong Kong officials have been pushing the city as an Asian crypto hub since last year. While the new licensing regime would put in place new standards and regulations for crypto, much of the industry has responded positively to the news, with firms expressing interest in applying for a crypto license in HK.
See related article: Hong Kong to mandate stablecoin licensing as early as this year
