Business News Report
February 05, 2024

Hong Kong’s SFC Warns Crypto Exchanges, Obtain Licenses or Shut Operations by May 31st

Hong Kong's SFC Warns Crypto Exchanges, Obtain Licenses or Shut Operations by May 31st

Hong Kong’s Securities and Futures Commission (SFC) has issued a stern warning today to unregistered Virtual Asset Trading Platforms (VATPs) operating within its jurisdiction. In a notice dated February 5, the SFC mandated that these platforms must submit their licensing applications by February 29 or face closure of their businesses by May 31.

The SFC reiterated the importance of investors engaging only with licensed platforms within the region. To ensure compliance, investors are advised to verify the regulatory standing of these platforms through the SFC’s “List of licensed virtual asset trading platforms” or the “List of virtual asset trading platform applicants” by March 1.

“Investors should check the regulatory status of a VATP from time to time and in any event on March 1, 2024. This is because VATPs operating in Hong Kong that have not submitted their license applications to the SFC by February 29, 2024, MUST close down their businesses in Hong Kong by May 31, 2024, pursuant to the transitional arrangements under the SFC’s regulatory regime for VATPs (Notes 1 and 2),” stated SFC.

Hong Kong initiated its cryptocurrency licensing framework for virtual asset trading platforms last year, paving the way for licensed exchanges to offer retail trading services.

Presently, the city-state has licensed two platforms, including HashKey and OSL. However, the SFC has scrutinized applications from 14 crypto entities, including OKX, Bybit and HKVAEX. It’s emphasized that the application process does not guarantee approval, and investors are cautioned to exercise prudence when engaging with these platforms.

“The SFC, however, reminds the public that the applications submitted by applicants on the “List of virtual asset trading platform applicants” are still being processed and they may – or may not – be approved; hence, trading on these platforms carries a risk,” the notice mentions.

Hong Kong Ramps Up Pro-Crypto Regulations

To enhance transparency and protect investors, the SFC has acted against fraudulent activities in cryptocurrency. Notably, the regulator labeled JPEX, a cryptocurrency falsely claiming to be awaiting a Hong Kong crypto license, as a fraud.

This follows the largest crypto scam in the jurisdiction, where Hong Kong police received complaints from over 1,600 investors involving HK$1.2 billion in crypto assets.

Moreover, Hong Kong authorities have recently unveiled a comprehensive regulatory framework for stablecoins, demonstrating their commitment to fostering a pro-crypto environment. Additionally, the city-state has expressed readiness for spot Bitcoin exchange-traded fund (ETF) products, further solidifying its stance in the evolving crypto landscape.

As the deadline approaches, virtual asset investors are urged to comply with regulatory requirements and conduct due diligence to protect their investments.

Disclaimer

In line with the Trust Project guidelines, please note that the information provided on this page is not intended to be and should not be interpreted as legal, tax, investment, financial, or any other form of advice. It is important to only invest what you can afford to lose and to seek independent financial advice if you have any doubts. For further information, we suggest referring to the terms and conditions as well as the help and support pages provided by the issuer or advertiser. MetaversePost is committed to accurate, unbiased reporting, but market conditions are subject to change without notice.

About The Author

Kumar is an experienced Tech Journalist with a specialization in the dynamic intersections of AI/ML, marketing technology, and emerging fields such as crypto, blockchain, and NFTs. With over 3 years of experience in the industry, Kumar has established a proven track record in crafting compelling narratives, conducting insightful interviews, and delivering comprehensive insights. Kumar's expertise lies in producing high-impact content, including articles, reports, and research publications for prominent industry platforms. With a unique skill set that combines technical knowledge and storytelling, Kumar excels at communicating complex technological concepts to diverse audiences in a clear and engaging manner.

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Kumar Gandharv
Kumar Gandharv

Kumar is an experienced Tech Journalist with a specialization in the dynamic intersections of AI/ML, marketing technology, and emerging fields such as crypto, blockchain, and NFTs. With over 3 years of experience in the industry, Kumar has established a proven track record in crafting compelling narratives, conducting insightful interviews, and delivering comprehensive insights. Kumar's expertise lies in producing high-impact content, including articles, reports, and research publications for prominent industry platforms. With a unique skill set that combines technical knowledge and storytelling, Kumar excels at communicating complex technological concepts to diverse audiences in a clear and engaging manner.

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