Bloomberg reported Thursday that Hong Kong is considering relaxing its cryptocurrency regulations to allow retail trading.
The publication, which elaborates:
After years of skepticism, Hong Kong will legalize crypto retail trading starting March. This is a stark contrast with mainland China’s ban.
The news outlet said that regulators want retail exchanges to be able to list large cryptocurrency, such as bitcoin ( TTC) or ether ( ETH_). Listing rules will likely include criteria like the token’s market price, liquidity, inclusion in third-party crypto indexes, and inclusion.
Gary Tiu, executive vice president at the crypto firm BC Technology Group, said:
Not only is mandatory licensing in Hong Kong an important task, but it’s not the only one. They won’t be able to meet the demands of all retail investors.
Michel Lee, the executive president of Hashkey’s digital asset financial services company, stated that Hong Kong is trying to establish a comprehensive crypto system. He cited tokenized stocks, bonds, and other assets as an important future segment. “Trading digital assets is not the goal. He stated that the goal was to actually grow the ecosystem.
The Securities and Futures Commission (SFC), Hong Kong’s financial regulator, introduced a voluntary licensing system in 2018. The SFC, Hong Kong’s top financial regulator, introduced a voluntary licensing regime in 2018. It limited crypto trading platforms to clients who had a portfolio of less than HK$8million ($1 million). The strict regulation disqualified many crypto businesses, and only two firms, BC Technology Group & Hashkey, were approved.
However, many people remain skeptical about the new regulation. Leonhard Weese, co-founder of the Bitcoin Association of Hong Kong, shared this:
People still worry about strict licensing rules, according to the conversations I’ve had. They won’t be as appealing or competitive as other overseas platforms, even if they can deal directly with retailers.
Elizabeth Wong , director of licensing at the SFC and head of its fintech unit, said last Wednesday: “We have four years of experience in regulating that industry… It may be a good moment to really think about whether or not we will continue with the professional investor-only requirement.” She also mentioned that Hong Kong could authorize exchange-traded fund (ETFs), to provide exposure to major crypto assets.