Hong Kong has abandoned its skepticism about cryptocurrencies and plans to legalize retail trading, as opposed to the ban in mainland China. It plans to implement a mandatory licensing program for its cryptocurrency platform, which will come into effect next March to allow retail transactions, and shared people familiar with the development but who asked to remain anonymous as the information has not been made public.
Bloomberg sources said the regulator will allow the listing of larger tokens but will not endorse certain coins such as Bitcoin and Ether, with further details and a timetable to be announced after public consultations. Ru.
The government is likely to share details of its plans to create a top crypto hub at its fintech conference starting Monday. It is part of an effort to restore Hong Kong’s credibility as a financial center after it caused an outflow of talent.
“Introducing a compulsory license in Hong Kong is just one of the key things that regulators have to do. They cannot effectively close the needs of retail investors forever. ”
A spokeswoman for the Hong Kong Securities and Futures Commission declined to comment on details of the plan. Shares of several Hong Kong-listed crypto-related companies rose on Friday after the development.
Regulators around the world are struggling with how to manage the highly volatile digital asset sector, which has picked up some of the $2 trillion crash since its peak in November 2021. The crash brought down various cryptocurrency organizations, exposing unlimited leverage and poor risk management. , added the Bloomberg report.
Hong Kong’s traditional rival in financial business, Singapore, was hit by an implosion and tightened digital asset rules to curb retail transactions. Earlier this week, Singapore proposed banning retail token purchases using leverage. China declared the cryptocurrency sector almost illegal a year ago.
Michelle Lee, executive president of digital asset specialist HushKey Group, said Hong Kong is indeed looking to build a comprehensive crypto regime beyond retail token trading.
He said tokenized versions of stocks and bonds could become a more important segment in the future. “Trading digital assets alone is not the only goal,” Lee said. “The real goal is to grow the ecosystem.”
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