Hong Kong Exchange Group Warns That New Regulations Could Increase Crime
Hong Kong exchanges have reportedly informed regulators about the dangers of the impending new crypto regulations. According to industry stakeholders, the Hong Kong government is set to ban retail trading in the city, severely affecting.
New Crypto Regulation In Development
This development was revealed today by local news outlet the South China Morning Post. According to the report, exchanges within Hong Kong are apprehensive about the government’s new crypto regulations.
Hong Kong’s Financial Services and Treasury Bureau had put forth a proposal in November limiting crypto trading to professional investors. The regulation had been put forward to industry bodies and public members for consultation, which ended in January. The government plans to turn the proposal into a bill and introduce it into law later in the year. However, the crypto bill is not without opposition from concerned cryptocurrency stakeholders.
Global Digital Finance, a group representing crypto exchanges Huobi, BitMEX, OKCoin, and Coinbase, is against aspects of the bill. According to the group banning retail investors from trading cryptocurrency would lead them towards unregulated platforms outside the law’s reach.
Another group, the Bitcoin Association of Hong Kong, stated that there needs to be clarity regarding cryptocurrencies’ classification. According to the group, the government must explain why bitcoin is different from other precious metals or foreign currencies. It further stated that any barrier to restrict the sale or purchase of bitcoin needs to be reasonable and justified.
Cryptocurrency Gaining Adoption In Hong Kong
Hong Kong is acknowledged as the financial center of Asia with its housing of several financial institutions. Amid this booming sector, cryptocurrencies have emerged as a popular asset within the city. Retail trading is the most popular way to get cryptocurrency in the Asian city. Also, Hong Kong has one of the highest numbers of retail traders in the region.
The new law will severely limit the progress of cryptocurrency adoption in the country. This is because Hong Kong’s securities define an individual professional investor as having a portfolio of at least HK$ 8 million (1,031,892). A recent survey recently revealed that less than 8% of the city’s population have a net worth of HK$10 million ($1.3 million).
The coming weeks will reveal whether the government will continue with the crypto bill or make necessary adjustments to fit the industry stakeholders’ recommendations.