May 15, 2023
By Sharan Kaur Phillora
Hong Kong’s de facto central bank has clarified that crypto companies enticed by the city’s attempt to establish themselves as a hotspot for digital-asset business will not operate under very lax regulations.
Here’s what we know:
“Our regulations will be tight,” Eddie Yue Wai-man, Chief Executive of the Hong Kong Monetary Authority (HKMA), said at Tuesday’s Bloomberg Wealth Asia Summit.
On June 1, Hong Kong will launch a new licensing regime for virtual-asset service providers, Bloomberg noted in a report quoting Yue’s statements. The plan also allows retail investors to acquire and trade major cryptocurrencies like bitcoin and ether.
The crypto-friendly move is part of efforts by authorities in China’s special administrative region to restore Hong Kong’s credentials as a leading financial center in the aftermath of restrictions imposed in response to the territory’s Covid pandemic and political unrest.
Yue pointed out that the region would encourage these businesses to create their ecosystem. This shows the city’s understanding of the potential of cryptocurrencies and its role in shaping the future of finance.
This development comes when the global cryptocurrency market is experiencing tremendous growth. Yue commented that the city’s crypto guardrails were very tight in the last few years.
He emphasized that they have now been lowered to a “reasonable and sustainable level,” but they won’t allow the recurrence of any FTX-type event in the city. Hong Kong’s legislative framework introducing the new crypto rules will bring transparency and clarity, Yue insisted in the interview.
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.