Hong Kong’s Securities Futures Commission (SFC) will release guidelines on the licensing regime for cryptocurrency exchanges by end of the month. SFC CEO Julia Leung announced the plan during an event, noting that the city will unveil its new cryptocurrency framework in May, according to a report by Bloomberg.
Here’s what we know:
Back in February, the SFC published a consultation paper on its proposed regulatory regime for crypto trading platforms. As per the Bloomberg report, the consultation paper has garnered more than 150 responses.
Furthermore, in a new licensing regime for crypto platforms set to come into effect starting in June, the SFC will allow retail investors to trade certain digital currencies, the agency said earlier this year.
The regulator detailed that retail investors would be allowed to trade certain “large-cap tokens” on licensed exchanges, given that safeguards such as knowledge tests, risk profiles, and reasonable limits on exposure are put in place.
The agency did not specify which large-cap tokens would be allowed. However, a report by the FT claimed Bitcoin and Ethereum, the two largest cryptocurrencies by market cap, would be opened up to retail customers.
The SFC first introduced its crypto regulatory framework back in 2018, which banned retail investors from trading crypto. However, the SFC has recently said that the “virtual asset landscape has changed significantly” since it first announced the regulatory regime.
It is worth noting that some licensed trading platforms have already begun offering crypto-related services to investors in Hong Kong under the SFC’s supervision.
About the author
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.