February 9, 2020
The Hong Kong government has shown interest in creating a licensing system for all crypto exchanges. The emphasis was further laid in a recently published discussion paper.
Here’s what we know:
- According to the paper, the Anti-Money Laundering and Counter-Terrorist Financing bill states that any crypto exchange is a “regulated virtual asset activity” and any person who seeks to engage in this work must be licensed by the Securities and Futures Commission (SFC).
- On 28 January 2022, Hong Kong’s principal financial services regulators issued a much-anticipated framework on guidance to banks, securities firms, and insurers looking to undertake activities related to virtual assets (VAs).
- According to the framework, engaging in virtual asset services without a license would be a criminal offense and subject to imprisonment and fines. No unlicensed crypto exchanges or persons may promote their services to the Hong Kong public.
- These amendments to the crypto regulation are expected to be submitted to the legislative council in the second quarter. Once set into motion, all crypto exchanges must apply for a license from the SFC within 180 days.
- This is a good time for businesses to start preparing now. Although there will be a 180-day transition period, businesses should use this time wisely, as it may take time and resources to design and implement new requirements.
Sharan Kaur Phillora’s thirst for knowledge has led her to study many different subjects, including NFTs and Blockchain technology – two emerging technologies that will change how we interact with each other in the future. When she isn’t exploring a new idea or concept, she enjoys reading literary masterpieces.