Hong Kong Lets Retail Investors Trade Crypto in New Rules

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Hong Kong Lets Retail Investors Trade Crypto in New Rules:Retail investors can trade larger tokens in regime from June 1. City’s push for a crypto hub contrasts with Asian clampdowns

Hong Kong said retail investors can trade crypto under its new rulebook for the sector, stepping up a drive to develop a digital-asset hub even as the industry and regulators clash elsewhere in Asia.

The city’s Securities and Futures Commission on Tuesday detailed the conclusions of a consultation on retail participation. The agency stuck with a plan to let individual investors buy and sell bigger tokens like Bitcoin and Ether starting June 1 when a new licensing regime for virtual-asset platforms begins.

The Securities and Futures Commission (SFC) in Hong Kong announced that it will soon allow licensed platforms to serve retail investors.

Hong Kong Lets Retail Investors Trade Crypto in New Rules

Hong Kong Lets Retail Investors Trade Crypto in New Rules: In an announcement on May 23 from the SFC, the regulator said operators of virtual asset trading platforms willing to comply with the SFC’s proposed guidelines are welcome to apply for a license.

The guidelines to be followed for virtual asset trading platforms will include aspects such as asset custody safety requirements, segregation of client assets and cybersecurity standards, among others.

The SFC CEO Julia Leung said that providing clear regulator expectations is “key” for creating a responsible, and innovative development environment.

“Hong Kong’s comprehensive virtual assets regulatory
framework follows the principle of ‘same business, same
risks, same rules’ and aims to provide robust investor
protection and manage key risks.”


Hong Kong Lets Retail Investors Trade Crypto in New Rules:  While the guidelines will become effective as of June 2023, the SFC has yet to approve any virtual asset trading platform to provide services to retail investors. According to the announcement during the consultation period, the SFC received 152 written submissions from within the industry.

Additionally, the SFC said it will be implementing a “number of robust measures” to ensure protection for retail investors. These include good governance, suitability during the onboarding process and enhanced token due diligence, along with admission criteria and disclosure.

The announcement pointed out at the moment, most of the virtual asset trading platforms accessible to the public are not regulated by the SFC.

It continued to say, those who do not wish to comply with the upcoming guidelines should plan for an “orderly closure” of business operations in Hong Kong.

In an interview with Cointelegraph in early May, Neil Tan, the chair of the FinTech Association of Hong Kong said the country opening the financial industry to digital assets is “just a natural progression.”

On May 17, the state-owned Chinese company Greenland applied for a virtual asset trading license in Hong Kong. Hong Kong Lets Retail Investors Trade Crypto in New Rules