Hong Kong warns unlicensed crypto platforms
The Hong Kong Securities and Futures Commission (SFC) issued a warning today regarding unlicensed cryptocurrency exchanges engaging in “improper practices.” The regulator highlighted that conducting unlicensed activities in the crypto trading space is considered a “criminal offence” in Hong Kong.
The SFC further stated that some unlicensed crypto trading platforms falsely claim to have submitted license applications to the commission when, in reality, they have not done so. The warning comes as the SFC is implementing a new regime for regulating crypto retail trading, and it emphasizes that applicants who violate relevant regulations may not be granted a license under this new framework.
This move by the SFC is part of the ongoing efforts by Hong Kong authorities to regulate the cryptocurrency market and ensure that all participants comply with the necessary legal requirements to protect investors and maintain the integrity of the financial system.
“VATPs which consider themselves eligible for deeming under the transitional arrangements are reminded that the SFC may decide that deeming is inapplicable if it does not see a reasonable prospect for the VATPs to successfully show that they are capable of complying with the applicable legal and regulatory requirements,” the SFC said.
The move also comes a few weeks after Hong Kong’s regulator revealed plans to permit licensed cryptocurrency platforms to cater to retail investors under its new regulatory framework for the sector.
The proposed guidelines encompass various aspects such as asset custody safety requirements, cybersecurity standards, and the segregation of client assets, among others. This was implemented from June 1, coinciding with the launch of a new licensing regime for virtual asset platforms.
VATPs which consider themselves eligible for deeming under the transitional arrangements are reminded that the SFC may decide that deeming is inapplicable if it does not see a reasonable prospect for the VATPs to successfully show that they are capable of complying with the applicable legal and regulatory requirements
Earlier in Aoril, cryptocurrency exchange OKX said it garnered over 10,000 new user registrations within a month of launching its operations in Hong Kong.
This remarkable influx is particularly noteworthy as OKX becomes the first exchange in Hong Kong to reach this milestone following the implementation of the city’s new virtual asset service providers (VASPs) regime on June 1, 2023.
