Regulation

Hong Kong to only allow investing in highly liquid virtual assets

Hong Kong’s Securities and Futures Fee (SFC) Chair Julia Leung stated the fee will permit retail traders to commerce solely extremely liquid crypto property, South China Morning Put up reported.

Earlier on Jan. 9, Hong Kong’s Monetary Secretary Paul Chan introduced that from June 2023, the federal government will begin issuing licenses to permit crypto exchanges to supply buying and selling providers to retail traders.

Nonetheless, the newly appointed SFC Chair Julia Leung stated that buying and selling in crypto property can be restricted to extremely liquid merchandise.

Leung famous that a number of crypto exchanges have over 2,000 property listed, however, the SFC won’t permit retail traders to commerce in all of them. Leung stated:

“We are going to set the factors that will permit retail traders to solely commerce in main digital property.”

The SFC Chair added that solely property with deep liquidity can be on the buying and selling checklist. It is going to be dangerous for retail traders to commerce property with low liquidity as they’re extra vulnerable to market manipulation.

She stated the regulator will work to make sure that accredited exchanges have enough liquidity to deal with unstable market situations.

Moreover, the June 2023 regulatory guideline would require crypto exchanges to have danger administration, inner controls, and correct custodian preparations, with a purpose to safeguard their clients’ property.

Moreover, Leung stated the SFC will work with the Hong Kong Inventory Trade to permit listed exchanges to reveal their local weather dangers.

Posted In: Hong Kong, Regulation

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