A cryptocurrency advocacy group has warned that Hong Kong’s proposed rules on digital asset investment could drive traders toward unregulated platforms.

  • In November, Hong Kong’s Financial Services and the Treasury Bureau (FSTB) said its new framework would put all digital asset exchanges under the oversight of the Securities and Futures Commission and limit trading in cryptocurrencies to professional investors only.
  • If implemented, the new regime would encourage retail investors to seek out unlicensed and peer-to-peer platforms, according to Global Digital Finance (GDF), an industry body representing cryptocurrency firms including OKCoin, BitMEX, and Coinbase.
  • GDF added this would raise the financial risk for retail investors seeking such alternative trading venues.
  • “Restricting cryptocurrency trading to professional investors only is different to what we have seen in other jurisdictions such as Singapore, the U.K. and the U.S., where retail investors can buy and sell virtual assets,” said Malcolm Wright, chairman of GDF’s advisory council, said in a report from the South China Morning Post on Monday.

Read more: Thieves Grab $451K in Cash From Hong Kong Crypto Trader

The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups.