Spot market crypto exchange-traded funds (ETFs) are reportedly set to launch in Hong Kong as soon as next week. According to a new report by Reuters, the three asset managers who are providing the products say that Bitcoin (BTC) and Ethereum (ETH) ETFs should start trading by April 30th as they have already received regulatory […]
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The approval of spot market Bitcoin (BTC) and Ethereum (ETH) exchange-traded funds (ETFs) could reportedly happen in Hong Kong as early as next week According to a new report by Bloomberg, anonymous people familiar with the matter say that two companies – Chinese asset manager Harvest Fund Management as well as a partnership between Bosera […]
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The Securities and Futures Commission (SFC) of Hong Kong is adding crypto exchange Bybit to its list of suspicious virtual trading platforms. In a new statement, the financial regulator warns investors that Bybit is an unlicensed virtual asset trading platform (VATP). “The SFC cautions investors against investing with unlicensed entities. Investors may risk losing their […]
The post Hong Kong Financial Regulator Adds Crypto Exchange Giant Bybit to List of ‘Suspicious’ Virtual Asset Platforms appeared first on The Daily Hodl.
Unlicensed cryptocurrency platforms will not be allowed to operate in Hong Kong starting next June, according to the Securities and Futures Commission (SFC). The commission closed the period for these institutions to introduce their applications to obtain a license on February 29 and will progressively expel the noncompliant exchanges from the Hong Kong market. Hong […]
A multinational asset management giant has reportedly submitted the first application for a spot Bitcoin (BTC) exchange-traded fund (ETF) in Hong Kong. Harvest Fund Management applied to the Securities and Futures Commission (SFC) of Hong Kong, according to a recent report from the Chinese media outlet Tencent News. Tencent also reports that the regulator hopes […]
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Christopher Hui took the stage at Fintech Week and outlined a list of regulatory moves Hong Kong authorities are looking to implement following the JPEX scandal.
The Hong Kong government says the recent $165 million alleged scandal involving crypto exchange JPEX won’t stifle its Web3 vision for the region.
In a Nov. 2 keynote at Hong Kong Fintech Week, the region’s Secretary for Financial Services and the Treasury Christopher Hui said the saga hasn’t affected the government’s plan.
“We’ve been asked many times whether JPEX will affect our determination to grow the Web3 market — the answer is a clear ‘no.’”
Hui was referring to the financial scandal involving the Dubai-based exchange JPEX, where 2,500 locals allege they were allegedly defrauded, prompting the Securities and Futures Commission (SFC) to warn that JPEX was promoting its services locally without a license.
Hong Kong said it would tighten its crypto regulations after JPEX’s alleged actions. Additionally, the SFC set up a task force with the police to deal with illicit crypto exchange activities and updated its policies on crypto sales and requirements.
Hui said “a lot of things are going on on the regulatory front” — part of the government’s future Web3 regulatory framework plan sees the SFC issuing guidance on tokenized securities and the tokenization of SFC-authorized investment products.
Crypto regulations will also be expanded to cover buying and selling “beyond trades taking place on now-regulated trading platforms,” Hui said.
Related: Hong Kong advances CBDC pilot, bringing e-HKD trials to phase 2
A “much sought after” joint consultation on stablecoins by the Hong Kong Monetary Authority (HKMA) and the Financial Services and the Treasury Bureau is also set to drop soon, which will take feedback from a January HKMA discussion paper.
Reports earlier this year said the HKMA pressured banks to provide services to crypto companies in the religion. Hui said the HKMA will consult the sector on guidance for “banks providing digital asset custodial services.”
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The joint group was established in light of the ongoing crypto scandal in Hong Kong involving the JPEX crypto exchange.
The Hong Kong Police Force (HKPF) and the Securities and Futures Commission (SFC) have set up a crypto-focused working group to deal with illicit crypto exchange activities.
In an Oct. 4 statement, the SFC said the group was formed after a meeting with the HKPF on Sept. 28 amid continuing arrests and developments in connection to the Dubai-based JPEX exchange.
Days before the meeting, 11 people were detained for questioning over their possible role in the JPEX scandal, in which the SFC has alleged the firm has been promoting its services in the region without a license.
The working group’s aim is to enhance monitoring and investigation of illegal activities carried out by Virtual Asset Trading Platforms (VATPs) and will share information on suspicious activities, assess risks of suspicious exchanges, and collaborate on investigations.
Hong Kong’s regulators previously flagged they were looking to tighten crypto market regulations in the wake of the JPEX saga.
The group comprises officials from the SFC's enforcement division and HKPF officials from its commercial, cybersecurity and financial intelligence and investigations bureaus.
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In a statement, SFC enforcement director Christopher Wilson said the regulator looked forward to deploying its resources to combat “problematic VATPs and protect the interest of investors.”
Eve Chung, HKPF’s Assistant Commissioner of Police (Crime), said the working group is instrumental in exchanging intelligence and jointly responding to “challenges arising from VATPs, to better protect the general public of Hong Kong.”
The SFC has since published a list of all licensed, deemed licensed, closing down, and application-pending exchange’s along with a list of “suspicious VATPs.”
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SEBA Hong Kong’s approval joins a flurry of regulated crypto activity that’s taken place over the past month.
The Hong Kong arm of crypto-friendly Swiss bank SEBA Bank has received in-principle approval from the Hong Kong Securities and Futures Commission (SFC) allowing it to deal in virtual assets.
On Aug. 30, SEBA Hong Kong said its in-principle approved license would allow it to operate with crypto products such as over-the-counter derivatives, advise on virtual assets and conduct asset management for discretionary accounts in virtual assets.
Speaking to Cointelegraph the Asia-Pacific CEO of SEBA Hong Kong Amy Yu said Hong Kong provides enormous potential due to the SFC’s virtual asset regulatory framework and the city’s legal system.
Yu added while China has a crypto trading ban, Hong Kong is “well-positioned to tap into the Chinese market when it opens up” as its in a strategic location in being close to the mainland, while also being a Special Administrative Region of China.
“Hong Kong may once again serve as a gateway to China, delivering the significant potential of cryptocurrencies and blockchain technology.”
On its decision to pursue a local license, Yu said SEBA received inquiries from crypto companies who had “difficulty in accessing and managing their digital assets holdings via traditional providers” along with interest from private wealth and family offices.
In Switzerland, SEBA Bank offers both traditional banking and crypto services such as trading, staking, lending and custody.
Related: ‘Breakthrough growth’ will be driven by Web3: Hong Kong financial secretary
SEBA’s approval in principle comes amid a flurry of regulated crypto activity in Hong Kong.
Crypto exchange HashKey — the first exchange in Hong Kong to get regulatory clearance — was reported to begin offering retail trading in Bitcoin (BTC) and Ether (ETH) on Aug. 28.
Its peer trading platform OSL also received the SFC’s approval to offer retail trading. HashKey and OSL are currently the only two fully licensed exchanges in Hong Kong.
That may soon change as on Aug. 11 the Hong Kong Virtual Asset Exchange (HKVAX) was given in-principle approval from the SFC to operate a crypto trading platform.
Magazine: Asia Express: China’s risky Bitcoin court decision, is Huobi in trouble or not?
The task force will advise on the “sustainable and responsible” development of Web3 in Hong Kong, according to the statement.
As part of Hong Kong's ongoing commitment to embrace the "megatrend" of Web3 development, it has established a diverse group of industry and government officials to supervise the progress of Web3 in the region.
According to a June 30 statement, the government of Hong Kong has formed a task force comprising 15 industry participants and 11 key government officials to oversee the development of Web3, with a particular focus on promoting its growth in an ethical manner. It stated:
“The Financial Secretary has announced in the 2023-24 Budget the establishment of the Task Force to provide recommendations on the sustainable and responsible development of Web3 in Hong Kong.”
The Govt announces the establishment of the Task Force on Promoting #Web3 Development https://t.co/wrC1DmE2QD
— Hong Kong SAR Government News (@newsgovhk) June 30, 2023
Paul Chan, Hong Kong’s financial secretary said that the task force will only further enhance Hong Kong’s aim to be a frontrunner in the Web3 sector.
“Hong Kong seeks to lead and drive innovative exploration and development, create more new application models, and strives to draw together top-notch companies and talent in the arena to build a thriving ecosystem” Chan stated, adding:
“With the Task Force bringing together leaders and professionals in the sectors involved, I believe their valuable advice will help Hong Kong develop into a Web3 hub.”
It was highlighted that the market has “responded favorably” to the Hong Kong government policy statement on the development of virtual assets, which was released in October 2022.
Cointelegraph reported on March 20 that over 80 virtual asset-related companies have expressed interest in “establishing their presence in Hong Kong” since the release of this statement.
Related: HSBC rolls out cryptocurrency services in Hong Kong: Report
The Hong Kong government has been actively promoting the region as an attractive place for crypto firms in recent times.
On June 10, Johnny Ng, a Hong Kong Legislative Council member took to Twitter to extend an invitation to "all global virtual asset trading platforms" to come to Hong Kong and apply for a virtual asset service provider license.
He mentioned crypto exchange Coinbase specifically, amid the United States Securities and Exchange Commission taking legal action against the exchange just days earlier on June 6.
I hereby offer an invitation to welcome all global virtual asset trading operators including @coinbase to come to HK for application of official trading platforms and further development plans. Please feel free to approach me and I am happy to provide any assistance. pic.twitter.com/bcIi1IjMlc
— Johnny Ng 吴杰庄 (@Johnny_nkc) June 10, 2023
This comes after the Hong Kong Securities and Futures Commission (SFC) announced on May 23 that it would soon allow licensed platforms to cater retail investors.
It was stated operators of virtual asset trading platforms willing to adhere to the SFC’s proposed guidelines are encouraged to submit license applications.
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The two central banks are aiming to align their financial service sectors and said both share “many complementary strengths.”
Hong Kong and the United Arab Emirates' (UAE) central banks are looking to collaborate on cryptocurrency regulations and financial technology development.
On May 30, the Hong Kong Monetary Authority (HKMA) said it met with its counterparts at the Central Bank of the United Arab Emirates (CBUAE) with the two agreeing to “strengthen cooperation” on “virtual asset regulations and developments.”
The two central banks also pledged to facilitate discussions on “joint fintech development initiatives and knowledge-sharing efforts” with each region’s respective innovation hubs.
Financial infrastructure and financial market connectivity between the two jurisdictions were also noted as key points discussed.
CBUAE governor H.E. Khaled Mohamed Balama said he anticipates the relationship with the HKMA will be ongoing and long-term.
HKMA chief executive Eddie Yue said the relationship will benefit both jurisdictions economically as they share “many complementary strengths and mutual interests.”
Following the meeting, the two central banks held a seminar for senior executives from banks in Hong Kong and the UAE.
It covered various topics, including how cross-border trade settlement can be improved and exploring how UAE corporations can leverage Hong Kong’s financial infrastructure platforms in order to gain access to Asian and mainland markets.
The collaboration comes as Hong Kong’s Securities and Futures Commission (SFC) is allowing virtual asset service providers (VASPs) to cater to retail investors in Hong Kong starting June 1.
Meanwhile, on May 30 Hong Kong’s treasury chief Christopher Hui told the AFP that the city has allowed retail investors to trade crypto under its new regulatory regime because “virtual assets are going to stay.”
Hui claimed the benefits of utilizing cryptocurrencies outweighed the risks.
Related: Hong Kong to open crypto exchange access for retail users, but there’s a catch
"Despite the potential risks involved, (virtual assets) also carries with it fundamental value," he said, noting the importance of regulation:
"So for these positive elements to be harnessed, these activities have to be allowed in a regulated way."
Several cryptocurrency exchanges have filed applications to have dedicated Hong Kong crypto trading services since the SFC announced the application process, including CoinEx, Huobi and OKX.
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