Hong Kong’s Approach to Crypto Regulation Could Attract Capital, Talent to Asia: Bernstein
The Securities and Futures Commission is adopting a “regulate to protect” approach to digital assets, the report said.
Feb 21, 2023 at 10:04 a.m. UTC:format(webp)/cloudfront-us-east-1.images.arcpublishing.com/coindesk/5TMTUT6Y2JE5FAXWIZM3GLJFQ4.png)
Hong Kong (Shutterstock)
/arc-photo-coindesk/arc2-prod/public/LXF2COBSKBCNHNRE3WTK2BZ7GE.png)
The Hong Kong Securities and Futures Commission (SFC) has taken a “regulate to protect” approach to cryptocurrencies, contrasting with recent action in the U.S. of regulation by enforcement, Bernstein said in a research report Monday.
The broker says this could be a “critical fork in the road” for the cryptocurrency industry, which could lead to capital and talent moving to Asia as a crypto hub.
The SFC on Monday published its proposed rules for virtual asset trading platforms and is seeking public comment. It plans to allow retail investors access to licensed exchanges, subject to restrictions, the report said, reasoning that investors are better off dealing with licensed venues rather than offshore and unregulated players.
Trading in crypto derivatives remains off the table for now as the SFC has deferred the decision on allowing such instruments to a later point in time.
The new licensing regime is expected to go live June 1, with a 12-month transition period for existing crypto exchanges. Exchanges that are not already operating in Hong Kong will have to be fully compliant before they start trading.
Disclosure
Please note that our privacy policy, terms of use, cookies, and do not sell my personal information has been updated.
The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is an award-winning media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. In November 2023, CoinDesk was acquired by Bullish group, owner of Bullish, a regulated, institutional digital assets exchange. Bullish group is majority owned by Block.one; both groups 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, and an editorial committee, chaired by a former editor-in-chief of The Wall Street Journal, is being formed to support journalistic integrity.
:format(webp)/downloads.coindesk.com/arc/failsafe/user/1x1.png)
Will Canny is CoinDesk's finance reporter.
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.