According to a Bloomberg report, Hong Kong is planning to change crypto rules and implement new rules to make retail crypto trading legal in the city. This changing crypto rule is a part of their efforts to make Hong Kong a center for crypto.
This new plan to make Hong Kong a center of crypto would put in place mandatory licensing for crypto platforms, and it is expected that they would launch their program in March 2023. However, the timetable for such a plan is not finalized and put this work to public consultation.
Their decision to change crypto rules came during Hong Kong’s efforts to regain ground as a crypto hub after Covid-19, regulations, and political turmoil. As in the past, Covid-19, constraints, and political turmoil took off Hong Kong’s reputation as a place for crypto investors to do business.
Last week, the head of the fintech unit at the Securities and Futures Commission, Elizabeth Wong, teased this move to let retail traders back in on digital assets. In an event, Elizabeth said that the government was considering its crypto regulation bill, and the SFC was looking to allow individuals to invest in virtual assets directly.
Hong Kong was considered the powerhouse of crypto in Asia in recent years, as the city hosted Binance and FTX crypto exchange. But in 2018, after the country introduced a voluntary licensing regime, which limited crypto platforms to institutional clients. And their portfolios were worth at least HK$8 million.
If Hong Kong also gives operating permission to consumer-facing platforms in its new regulations, it could lead the country’s first step to winning back firms that have turned attention away in recent years.
China could put obstacles in Hong Kong’s efforts to make their country a ground for crypto. As the co-founder of BitMex, Arthur Hayes said that access to Chinese customers is crucial to Hong Kong’s attractiveness to crypto companies. Moreover, he said that as crypto investors, they care about Hong Kong’s ability to facilitate Chinese capital’s needs.
Arthur said that whether it is in retail sales or capital flows, the ordinary wealthy Chinese people power the Hong Kong economy. He believes that China is real this time.
