Regulatory Milestone
Hong Kong’s Securities and Futures Commission (SFC) has given the go-ahead to 11 crypto exchanges to keep operating in the city. This is the first step towards issuing licenses for virtual asset trading platforms (VATP). Hong Kong wants to become a major crypto hub, like Singapore and Dubai.
Approved Exchanges
Among the approved exchanges is Crypto.com, which was founded in Hong Kong but now operates from Singapore. It’s the only exchange in the top 20 by trading volume that’s still waiting for a license in Hong Kong. Bullish, another major exchange, is also on the list.
Regulatory Hurdles
Under new rules, exchanges need approval to keep operating while they wait for full licenses. Some exchanges have pulled out of the licensing process because of the changes. Several of these exchanges have ties to mainland China, which has cracked down on crypto.
Market Concerns
The withdrawals have raised concerns about Hong Kong’s ability to attract crypto businesses and build a strong Web3 ecosystem. Lawmaker Duncan Chiu says it’s shaken market confidence in local Web3 development.
Beijing’s Ban
Despite hopes of accessing mainland Chinese customers, Beijing still bans commercial crypto activities. Shenzhen’s financial authority has warned against cross-border crypto trading and emphasized its illegality.
Balancing Act
Hong Kong’s journey towards becoming a crypto hub is complex. It needs to balance regulatory compliance, market confidence, and attracting businesses in a rapidly changing global crypto landscape.
