Hong Kong Grants Licenses to Four More Crypto Exchanges

Hong Kong grants licenses to four more crypto exchanges, aiming to become a global crypto hub with efficient licensing processes.

Hong Kong is taking significant steps to establish itself as a global crypto hub by granting licenses to four more crypto exchanges. The Securities and Futures Commission (SFC) approved licenses for Accumulus, HKbitEX, DFX Labs, and EX.IO. These licenses came after on-site inspections when the exchanges responded to the regulator. Before that, licenses were granted to OSL, HashKey, and HKVAX. It shows that Hong Kong is actively working towards establishing a regulated market for crypto firms.

The licensing process that is used by the SFC is very efficient. On the 12th June 2023, Hong Kong officially commenced the licensing of VATPs which are involved in virtual asset trading. This new framework permits licensed exchanges to provide retail trading services. A fast and efficient process is also a priority of the SFC because global cities compete to become leaders in the cryptocurrency market. Therefore, the SFC has been directly approaching the senior management of VATPs to explain the respective regulatory standards.

Hong Kong Pushes to Become Crypto Hub with New Licenses

Additional information regarding the licensing process was published in the recent circular by the SFC. Currently, the exchanges require compliance evaluations of their platform policies, procedures, and controls. These evaluations have to be certified by a certified public accountant. Following this, the SFC coordinates a second-phase evaluation with VATPs and outside evaluators. After satisfactory completion of the assessment, limitations to the business scope are lifted, and exchanges can take place.

On the other hand, Hong Kong’s lawmaker Ng Kit-chuang has suggested that Hong Kong should invest its fiscal reserves in cryptocurrencies. Based on this, Ng recommended the government deploy the Exchange Fund to make investments in virtual commodities. Such a decision would bring the city to parity with the rest of the world, where more and more financial companies are starting to integrate cryptocurrencies. If this proposal is to be adopted, it would aid in putting this proposal as the dawn of a modern financial city in Hong Kong.

Hong Kong is gradually entering the top of the crypto industry due to the liberal licensing regime and constantly developing legislation. The recent licensing approvals show Hong Kong’s commitment to the crypto industry. Additionally, the proposal to include digital assets in fiscal reserves further emphasizes its goal of becoming a crypto hub.