Hong Kong Introduces Tokens Law For 12 Months Without “Bad Records” Allowed
Key Points:
- The SFC in Hong Kong said that licensed platforms would soon be able to service individual investors.
- Operators of virtual asset trading platforms who are ready to follow the SFC’s suggested criteria are invited to apply for a license.
- Asset custody safety criteria, client asset segregation, and cybersecurity standards will be among the parameters to be followed for virtual asset trading platforms.
As previously reported by Coincu, the Securities and Futures Commission (SFC) in Hong Kong officially announced that it will soon allow licensed platforms to serve retail investors. However, the region remains cautious in its approach to the crypto economy.
The Hong Kong SFC launched a consultation on the regulation of virtual asset trading platforms; non-security tokens must have a 12-month track record of no negative behavior; stablecoins are presently not permitted to be acquired by retail investors and must wait for the new policy.
According to the Hong Kong SFC, Earn and Lending services are illegal, as are promotional activities relating to certain cryptocurrencies, proprietary trading is prohibited, and platforms are prohibited from retaining crypto assets.
The Hong Kong government’s criteria said that tokens acquired by retail investors must be included in the two main indexes, which is the minimum requirement, therefore, the following tokens may be included in the first batch of Hong Kong-compliant exchanges.
The recommendations for virtual asset trading platforms will contain, among other things, asset custody safety criteria, client asset segregation, and cybersecurity standards.
Although the rules will go into effect in June 2023, the SFC has yet to authorize any virtual asset trading platform that would provide services to individual investors. Throughout the consultation period, the SFC received 152 written responses from the industry, according to the release.
The guidelines outline, among other things, secure custody of funds, client asset segregation, conflict of interest avoidance, and cybersecurity standards and obligations anticipated for regulated trading platforms. SFC will give more advice on the new regulatory requirements, as well as other implementation specifics such as license application processes and other information on the transitional arrangements.
Previously, a suggestion was proposed in a February consultation document to allow ordinary investors to trade top virtual assets on SFC-licensed exchanges. To protect investors, safeguards such as knowledge checks, risk profiles, and appropriate restrictions on exposure are in place. Additionally, investors are barred from trading crypto assets that are not included in at least two investible indexes from recognized industry suppliers, one of which has expertise in conventional finance.
According to the release, the majority of virtual asset trading platforms available to the public are not currently regulated by the SFC.
Moreover, Binance has barred Hong Kong users from utilizing services such as Earn, Lending, and depositing revenue. Hong Kong has declared that bitcoin profits, deposits, and loans would be prohibited. It is unclear if the Hong Kong dollar P2P service will be discontinued in the future.
DISCLAIMER: The information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.
Join us to keep track of news: https://linktr.ee/coincu
Harold
Coincu News
Author
News
Hong Kong Introduces Tokens Law For 12 Months Without “Bad Records” Allowed
Key Points:
- The SFC in Hong Kong said that licensed platforms would soon be able to service individual investors.
- Operators of virtual asset trading platforms who are ready to follow the SFC’s suggested criteria are invited to apply for a license.
- Asset custody safety criteria, client asset segregation, and cybersecurity standards will be among the parameters to be followed for virtual asset trading platforms.
As previously reported by Coincu, the Securities and Futures Commission (SFC) in Hong Kong officially announced that it will soon allow licensed platforms to serve retail investors. However, the region remains cautious in its approach to the crypto economy.
The Hong Kong SFC launched a consultation on the regulation of virtual asset trading platforms; non-security tokens must have a 12-month track record of no negative behavior; stablecoins are presently not permitted to be acquired by retail investors and must wait for the new policy.
According to the Hong Kong SFC, Earn and Lending services are illegal, as are promotional activities relating to certain cryptocurrencies, proprietary trading is prohibited, and platforms are prohibited from retaining crypto assets.
The Hong Kong government’s criteria said that tokens acquired by retail investors must be included in the two main indexes, which is the minimum requirement, therefore, the following tokens may be included in the first batch of Hong Kong-compliant exchanges.
The recommendations for virtual asset trading platforms will contain, among other things, asset custody safety criteria, client asset segregation, and cybersecurity standards.
Although the rules will go into effect in June 2023, the SFC has yet to authorize any virtual asset trading platform that would provide services to individual investors. Throughout the consultation period, the SFC received 152 written responses from the industry, according to the release.
The guidelines outline, among other things, secure custody of funds, client asset segregation, conflict of interest avoidance, and cybersecurity standards and obligations anticipated for regulated trading platforms. SFC will give more advice on the new regulatory requirements, as well as other implementation specifics such as license application processes and other information on the transitional arrangements.
Previously, a suggestion was proposed in a February consultation document to allow ordinary investors to trade top virtual assets on SFC-licensed exchanges. To protect investors, safeguards such as knowledge checks, risk profiles, and appropriate restrictions on exposure are in place. Additionally, investors are barred from trading crypto assets that are not included in at least two investible indexes from recognized industry suppliers, one of which has expertise in conventional finance.
According to the release, the majority of virtual asset trading platforms available to the public are not currently regulated by the SFC.
Moreover, Binance has barred Hong Kong users from utilizing services such as Earn, Lending, and depositing revenue. Hong Kong has declared that bitcoin profits, deposits, and loans would be prohibited. It is unclear if the Hong Kong dollar P2P service will be discontinued in the future.
DISCLAIMER: The information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.
Join us to keep track of news: https://linktr.ee/coincu
Harold
Coincu News
Other Posts
Related Posts
Latest
Solana memecoins crash while DTX Exchange hits 100,000 TPS on layer-1 blockchain
Strategic Bitcoin Reserve Expected to Cut 35% of US National Debt by 2049
The New Lead of Presidential Crypto Council Appointed by Trump Is Bo Hines
Press Release
Solana memecoins crash while DTX Exchange hits 100,000 TPS on layer-1 blockchain
Best New Meme Coins with 1000X Potential: BTFD Coin’s Hot BIG50 Discount As Baby Doge Coin, Dogs Takes Gaming to the Next Level
