Hong Kong issues policy statement on crypto

The Hong Kong authorities issued a crypto policy statement that clarified its plans to develop “a vibrant sector and ecosystem” for the nascent business 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 instantly in crypto.

Hong Kong crypto laws

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 steerage for banks and different monetary establishments giving crypto-related merchandise.

In accordance with the coverage assertion, licensed exchanges would function in compliance with essential anti-money laundering, counter-terrorist financing (AML/CTF), and investor safety legal guidelines. This may enable them “to entry a wider web of traders within the Hong Kong market.”

Hong Kong’s Securities and Futures Fee (SFC) will conduct a public session to find out the crypto publicity stage that retail traders could be granted. On the identical time, the federal government has hinted that it could welcome crypto-related Change Traded Funds (ETFs) in its jurisdiction.

Stablecoins and property rights

The Hong Kong authorities acknowledged that stablecoins “have a rising potential for important interconnectedness with the normal monetary markets, e.g., within the fee system.”

Going by this, the Hong Kong Financial Authority is searching for suggestions on a dialogue paper that goals to manage actions of payment-related stablecoins. In accordance with the coverage assertion, extra data will probably be supplied quickly.

In the meantime, the Hong Kong authorities conceded that its present non-public property legislation may not apply to digital belongings as they’ve distinctive traits that differentiate them from conventional investments.

Nevertheless, the federal government is prepared to evaluate its legislation provisions to bolster the adoption of tokenized belongings and decide the legality of sensible contracts.

Hong Kong to launch varied pilot schemes

The federal government can be exploring varied 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 foreign money (CBDC) e-HKD.

The federal government acknowledged 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 neighborhood and skills in Hong Kong.”

Crypto neighborhood approves Hong Kong transfer

The Hong Kong authorities coverage assertion has elicited constructive responses from the crypto neighborhood, who hailed it as a welcome improvement.

FTX founder Sam Bankman-Fried deeply appreciates “when policymakers have interaction constructively and optimistically with the individuals who matter probably the most for an business’s path.” He added that he wished the plan had come final yr.

The CEO of New World, Cheng Zhigang, said Hong Kong might change into the one place in China the place digital asset providers are authorized due to its benefits of 1 nation and two methods.

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