Hong Kong Amends Finance Law to Incorporate Crypto Firms

Virtual asset service providers will be covered by terror financing and anti-money laundering rules as of June 2023.

AccessTimeIconDec 8, 2022 at 12:53 p.m. UTC
Updated Dec 8, 2022 at 3:53 p.m. UTC
10 Years of Decentralizing the Future
May 29-31, 2024 - Austin, TexasThe biggest and most established global hub for everything crypto, blockchain and Web3.Register Now

Hong Kong is to subject crypto providers to the same anti-money laundering and counter-terrorist financing laws that it does traditional finance firms.

The territory's Legislative Council voted to add virtual asset service providers (VASP) to the Anti-Money Laundering and Counter Terrorist Financing Ordinance as of June 1, 2023, according to a Dec. 5 amendment to the law.

The fallout from the collapse of FTX, which was once based in Hong Kong before departing for Bahamas in September 2021, casts doubt over what crypto-friendly ambitions Hong Kong may now have. Prior to the exchange's failure early November, the territory showed signs of relaxing its tough regulations and becoming a more crypto-friendly environment. The Financial Services and Treasury Bureau said at the end of October that it was open to allowing retail customers to trade crypto or approving a virtual assets exchange-traded fund (ETF).

Last month, however, Julia Leung, the deputy CEO of the Securities and Futures Commission, called for tough rules to be implemented on crypto firms, saying that recent events had highlighted the volatility of the industry and the threats posed by its links with traditional financial services.




Disclosure

Please note that our privacy policy, terms of use, cookies, and do not sell my personal information has been updated.

CoinDesk is an award-winning media outlet that covers the cryptocurrency industry. Its journalists abide by a strict set of editorial policies. In November 2023, CoinDesk was acquired by the Bullish group, owner of Bullish, a regulated, digital assets exchange. The Bullish group is majority-owned by Block.one; both companies have interests in a variety of blockchain and digital asset businesses and significant holdings of digital assets, including bitcoin. CoinDesk operates as an independent subsidiary with an editorial committee to protect journalistic independence. CoinDesk employees, including journalists, may receive options in the Bullish group as part of their compensation.

Jamie Crawley

Jamie Crawley is a CoinDesk news reporter based in London.


Learn more about Consensus 2024, CoinDesk's longest-running and most influential event that brings together all sides of crypto, blockchain and Web3. Head to consensus.coindesk.com to register and buy your pass now.