Understanding the Implications of New Regulations”

Hong Kong has garnered consideration within the crypto business. Considerably, on June 1, the town applied new crypto rules. Wu Blockchain translated and revealed an evidence of the Hong Kong crypto rules and the article sheds mild on the implications of those rules for crypto firms in Hong Kong. So, let’s check out what all this implies.

TL;DR:

Hong Kong Crypto Rules: License Required for Exchanges within the Metropolis

Firstly, underneath the brand new rules, cryptocurrency exchanges should acquire licenses from the Hong Kong Securities and Futures Fee (SFC). The SFC has initiated the evaluation course of for license purposes. Nonetheless, they’re granting a one-year grace interval to present crypto exchanges with substantial operations in Hong Kong. Throughout this grace interval, these exchanges can both align their operations with the brand new rules or select to withdraw from the market.

Moreover, the SFC will grant operational approval solely to firms that show “real operations and real enterprise practices.” This allowance applies completely to non-securities buying and selling platforms.

As well as, the SFC outlines a number of standards to find out whether or not an alternate has real operations and practices. They contemplate components reminiscent of being based mostly in Hong Kong, having personnel managing the crypto platform within the metropolis, or sustaining a bodily workplace in Hong Kong.

Furthermore, the SFC defines operations in Hong Kong based mostly on whether or not the alternate is actively advertising to the Hong Kong public. If an alternate promotes its companies to the Hong Kong public, no matter its place of incorporation, it should acquire a license.

The rules additionally emphasize the necessity for “regulated people” to supervise these crypto platforms. Regulated people can embody administrators, accountable officers, and managers.

Lastly, these people will bear a complete “match and correct” evaluation by the SFC. Right here, they have to show their skilled expertise, no matter whether or not it was acquired in Hong Kong or one other jurisdiction.