Crypto: Hong Kong’s SFC To Pick Out Tokens For Retail Trading

Lavina Daryanani
Source: News

Hong Kong has consistently been making it to the crypto news headlines lately. A couple of weeks back, it opened doors to its very first BTC exchange-traded funds [ETF]. Two ETFs tracking US listed crypto futures veered into Hong Kong. They’re reportedly managed by CSOP Asset Management.

Additionally, in the beginning of this week, Financial Secretary Paul Chan said that Hong Kong will be a great place for crypto and fin-tech startups to operate from. He also asserted that the region remains committed to becoming a crypto hub.

Retail Trading Under Regulator’s Radar

Another key development unravelled on Wednesday. According to the same, crypto tokens will reportedly be shortlisted by the securities watchdog for retail trading.

Furthermore, the Securities and Futures Commission [SFC] will seek public views on certain regulatory aspects pertaining to retail trading.

Julia Leung, Chief Executive Officer of the Securities and Futures Commission clarified that the country’s new VASP regime would continue to focus on investor protection. Speaking at a panel discussion at the Asian Financial Forum in Hong Kong on Wednesday, Leung said,

“Virtual assets have in the past year gone from peak to low (price) levels. The good thing is that when the froth is taken out from the system as platforms and some tokens collapsed, it focuses investors and sellers’ minds on investor protection.”

Hong Kong’s Legislative Council passed an Anti-Money Laundering and Counter-Terrorist Financing amendment bill in December to introduce a licensing regime for VASPs. According to the same, anyone who engages in the virtual asset exchange business will have to apply for a license. Failing to do so could result in jail terms and fines.

Leung now said that the SFC will start accepting applications for VASP licences in mid 2024.

The relevant participants will also have to fulfill the “fit and proper test.” Alongside this, they will have to comply with the AML/CTF requirements. In addition, licensed VA exchanges and their wholly owned subsidiaries will have to “regularly” submit audited accounts and financial information to the SFC.

As far as retail trading consultation is concerned, industry sources told Reuters that they expect the consultation to begin in the first quarter.

Also Read: Hong Kong could legalize retail investor crypto trading via public consultation