Hong Kong is an emerging hub for crypto currency exchanges. It has widened its outlook in matters related with digital currency by inviting all the exchanges to establish registration within the region. Declaration of invitation for Coinbase and all other crypto firms has shown the crypto friendly behavior of Hong Kong.
The financial regulation in the U.S has made many exchanges gear up their partnership in other crypto friendly regions. Hong Kong is emerging as one of the best regions luring virtual assets exchanges.
Assistance To Crypto Exchanges For Registration
Johny Ng, Hong Kong’s Legislative Council member, requested Coinbase and other digital asset exchanges to apply for the license of operation in the region. He also promised to provide any assistance if required for registration.
This announcement came into focus because it came after the declaration made by the U.S. Securities and Exchange Commission (SEC). It had taken action against Coinbase mentioning the breaching of law caused due to selling of unregistered security assets.
Specifically mentioning Coinbase, Johny Ng. has invited all other crypto exchanges for registration in their area. Hong Kong has implemented many laws on crypto but has given the desired freedom to digital currency traders.
Justin Sun, founder of Tron Network, praised this step taken by a HK legislative council member and highlighted how the approach could make the region favorable for the crypto industry. Many firms have left the U.S. after the strict regulatory approach from the SEC. CoinEx, Beaxy, and Bittrex are some among them. The firms are already in search of crypto friendly banking partners.
Crypto Firms Lured By Crypto Friendly Behavior
The advance step of inviting virtual currency exchanges by the Hong Kong legislator, has attracted many firms. The legislator has also hinted at stock listing opportunities. The Western countries are approaching stricter rules for crypto regulation whereas Paul Chan, HK’s Financial Secretary says that they will provide a crypto friendly ecosystem with formulated regulations that will benefit the industry.
The declaration of providing official trading platforms and other developed plans for all crypto exchanges encouraged many to approach Hong Kong for expansion of market. Huboi and OKX were successfully expanding their services in the region. The only compulsion is to have a license or registration.
In February, news of the Chinese government acknowledging the permission for crypto initiatives taken by Hong Kong. This shows the importance of crypto work done there which was noticed and accepted by the Chinese government.
The tougher rules on digital assets are implemented by regulators in Europe. This includes declaration of some digital assets as security, highlighting the notified risk factor of virtual currency in ads etc. This might be the reason for crypto exchanges expanding their base in the rising market of Hong Kong.
Along with this, the announcement of welcoming Coinbase and other crypto exchanges to the region may result in the advancement of Hong Kong as a crypto hub.
The only implications here are registration of the firm and following the Anti Money Laundering (AML) regulations. Also, in Hong Kong the crypto currency is not considered a taxable asset.
Nancy J. Allen is a crypto enthusiast and believes that cryptocurrencies inspire people to be their own banks and step aside from traditional monetary exchange systems. She is also intrigued by blockchain technology and its functioning.
Source: https://www.thecoinrepublic.com/2023/06/12/coinbase-received-invitation-to-hong-kong-despite-charges-in-us/