Hong Kong Regulator To Release New Crypto Exchange Rules

The financial regulator of Hong Kong – which is the Securities and Futures Commission (SFC) is set to publish a new set of regulations for Bitcoin (BTC) as well as cryptocurrency exchanges. As the news show, the Hong Kong regulator will make the changes – something that first emerged in a report on Reuters led by the Chief Executive Ashley Alder during a local fintech event.

The Bitcoin news updates also show that the new requirements will detail how exchanges approach custody, compliance such as Know Your Customer (KYC) and Anti Money Laundering (AML) rules as well as other issues.

“The framework will enable virtual asset trading platforms to be regulated by the SFC, a major development which builds on a way forward I outlined at the same time last year,” said Alder.

The Hong Kong regulator first established these guidelines for crypto funds and exchanges in November 2018. A year later (now), the regulator is taking the work forward, according to Alder.

Commenting on the news, the private investor and analyst Dovey Wan says that this is quite a big deal for the entire crypto industry. She also pointed out that Huobi (in particular) may already be on its way to becoming the first licensed exchange in the country.

“WOW this is BIG,” wrote Wan. “Hongkong SEC will announce detail in about an hour regarding cryptocurrency exchange application criteria.” She added:

“Considering Huobi has already backdoor listed on HKex, this will def play them a huge favor to be the first legalized Chinese crypto exchange.”

Earlier this year in March, the Hong Kong regulator SFC also released its regulatory guidelines for Security Token Offerings. The agency then outlined that security tokens are “likely to be securities” under Hong Kong’s Securities and Futures Ordinance. This is why they fall under the existing securities laws.

Yesterday, the cryptocurrency news showed an increase in the BTC price and a momentum that leads the dominant cryptocurrency towards the $9,400 region. If this buildup continues, we might see BTC in the $10,000 (five digit) zone again very soon.

On the other hand, the news from the Hong Kong regulator show that the country, just like its neighbour China, is growing its interest towards crypto.