The Hong Kong authorities issued a crypto coverage assertion that clarified its plans to develop “a vibrant sector and ecosystem” for the nascent trade on October 31.
The coverage assertion marks a key change for the federal government, which had just lately revealed intentions to permit retail merchants to speculate immediately in crypto.
Hong Kong crypto rules
The authorities have launched a regulatory physique that licenses digital asset exchanges utilizing an “opt-in” method. The assertion continued that the federal government has additionally supplied steering for banks and different monetary establishments giving crypto-related merchandise.
In accordance with the coverage assertion, licensed exchanges would function in compliance with obligatory anti-money laundering, counter-terrorist financing (AML/CTF), and investor safety legal guidelines. This could enable them “to entry a wider internet of buyers within the Hong Kong market.”
Hong Kong’s Securities and Futures Fee (SFC) will conduct a public session to find out the crypto publicity degree that retail buyers can be granted. On the identical time, the federal government has hinted that it will welcome crypto-related Change Traded Funds (ETFs) in its jurisdiction.
Stablecoins and property rights
The Hong Kong authorities said that stablecoins “have a rising potential for vital interconnectedness with the standard monetary markets, e.g., within the fee system.”
Going by this, the Hong Kong Financial Authority is looking for suggestions on a dialogue paper that goals to manage actions of payment-related stablecoins. In accordance with the coverage assertion, extra info will probably be supplied quickly.
In the meantime, the Hong Kong authorities conceded that its present personal property regulation may not apply to digital belongings as they’ve distinctive traits that differentiate them from conventional investments.
Nonetheless, the federal government is prepared to evaluation its regulation provisions to bolster the adoption of tokenized belongings and decide the legality of sensible contracts.
Hong Kong to launch numerous pilot schemes
The federal government can be exploring numerous pilot initiatives that maximize the technological benefits of digital belongings.
In accordance with the assertion, the federal government is engaged on initiatives like NFT issuance for Hong Kong Fintech Week (HKFTW) 2022, Inexperienced bond tokenization, and a central financial institution digital forex (CBDC) e-HKD.
The federal government said that it was prepared to embrace the underlying applied sciences of digital belongings and promote the advantages in its jurisdiction. It continued that it welcomes the “clustering of Fintech and VA group and abilities in Hong Kong.”
Crypto group approves Hong Kong transfer
The Hong Kong authorities coverage assertion has elicited optimistic responses from the crypto group, who hailed it as a welcome improvement.
1) A extremely promising replace from HK on crypto: https://t.co/rXLpORfUvT
If solely it had come final yr…
— SBF (@SBF_FTX) October 31, 2022
FTX founder Sam Bankman-Fried deeply appreciates “when policymakers have interaction constructively and optimistically with the individuals who matter probably the most for an trade’s route.” He added that he wished the plan had come final yr.
The CEO of New World, Cheng Zhigang, mentioned Hong Kong may change into the one place in China the place digital asset companies are authorized due to its benefits of 1 nation and two programs.
