Hong Kong’s top financial official said the local government would soon announce a consultation on a proposed regulatory framework for over-the-counter cryptocurrency trading platforms as risks increase.
Christopher Hui, Minister of Financial Services and Finance, wrote on his blog: post OTC locations are easily accessible to the general public and some have been found to be involved in fraud cases.
“In fact, OTC venues played a role in some fraud cases involving some unlicensed VA trading platforms last year, misleading investors into focusing their funds on these unlicensed platforms,” Hui said. “We therefore believe it is necessary to make OTC venues a regulated entity and we will soon begin a consultation on the proposed regulatory framework.”
In June 2023, Hong Kong officially launched a cryptocurrency licensing regime for virtual asset trading platforms, allowing licensed exchanges to provide retail trading services. Hong Kong has so far granted such licenses to two platforms: HashKey and OSL.
Regulators granted a transition period to companies already operating in Hong Kong before the licensing system takes effect and required them to submit license applications by February 29.
Hui warned that as the deadline approaches, the Securities and Futures Commission is “preparing for enforcement work” and will step up public relations efforts.
Stablecoin consultation
In December, the Hong Kong Monetary Authority said in a joint statement: consultation documents The Department of Financial Services and Treasury said stablecoin issuers must obtain a license from the authority “if they issue stablecoins referencing the value of one or more fiat currencies in Hong Kong.” The two-month consultation is scheduled to end at the end of this month.
Hui said today that the HKMA plans to introduce a sandbox to explore stablecoin issuance with key industry players in the region.
Eddie Yue, CEO of HKMA said in december Stablecoins can become an interface between traditional finance and virtual asset markets.
“In a scenario where stablecoins become one of the preferred payment options for the general public, we should reasonably expect further integration between the digital payments ecosystem and the real economy, and whether stablecoins are actually ‘stable’ will become even more important. It will. “, Yue added.
Disclaimer: The Block is an independent media outlet delivering news, research and data. As of November 2023, Foresight Ventures is a majority investor in The Block. Foresight Ventures invests in other companies in the cryptocurrency space. Cryptocurrency exchange Bitget is an anchor LP of Foresight Ventures. The Block continues to operate independently to provide objective, impactful and timely information about the cryptocurrency industry. Below are our current financial disclosures.
© 2023 The Block. All rights reserved. This article is provided for informational purposes only. It is not provided or intended to be used as legal, tax, investment, financial or other advice.