Hong Kong to Start Allowing Retail Crypto Trading in March Next Year – Bloomberg reported on Thursday, citing sources familiar with the situation, that Hong Kong is easing its strict cryptocurrency regulations in order to allow retail crypto trading.
A mandatory licensing regime for cryptocurrency platforms that permits retail crypto trading is scheduled to be implemented in March of 2019, according to the publication, which elaborated: “Hong Kong plans to legalize retail trading for crypto starting in March after years of skepticism — a stark contrast to mainland China’s ban.”
In addition, officials want to allow retail exchanges to list major cryptocurrencies such as bitcoin (BTC) and ether (ETH), according to the news source. The listing criteria will likely include the token’s market value, liquidity, and inclusion in third-party crypto indexes.
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Gary Tiu, the executive director of the crypto company BC Technology Group, remarked, “Introducing mandatory licensing in Hong Kong is just one of the important things regulators have to do. They can’t forever effectively close the needs of retail investors.”
The executive president of digital asset financial services firm Hashkey, Michel Lee, noted that Hong Kong has been attempting to establish an all-encompassing crypto regime, noting tokenized stocks and bonds as a component that may become more significant in the future. “Just trading digital assets on its own is not the goal. The goal is really to grow the ecosystem,” he was quoted as saying.
The Securities and Futures Commission (SFC), Hong Kong’s leading financial regulator, implemented a voluntary licensing framework in 2018. It banned crypto trading platforms to clients with at least HK$8 million ($1 million) in investable assets. Only two companies, BC Technology Group and Hashkey, were allowed, as a result of the stringent legislation.
However, many individuals are skeptical about the new crypto regulation. Leonhard Weese, co-founder of the Bitcoin Association of Hong Kong, remarked: “The kind of conversations I’ve had was that people still fear there’ll be a very strict licensing regime. Even if they’re able to deal directly with retail users, they’re still not going to be as attractive or as competitive as overseas platforms.”
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Elizabeth Wong, director of licensing and head of the SFC’s fintech unit, stated last week: “We’ve had four years of experience in regulating this industry. We think that this may be actually a good time to really think carefully about whether we will continue with this professional investor-only requirement.” She noted that Hong Kong could also authorize exchange-traded funds (ETFs) to offer exposure to mainstream crypto assets.
