The Securities & Futures Commission (SFC), which handles crypto regulations in Hong Kong, is going all out in its efforts to establish the city as a top hub for the crypto industry. One year after the introduction of a comprehensive digital-asset rulebook, 11 crypto exchanges are in line for licensing to start operating within the city. This initiative aims to bring more regulatory clarity and build a robust digital asset market in the region.
Among the exchanges that are “deemed to be licensed” by the SFC, as indicated on its website on June 1, are prominent platforms such as Crypto.com and Bullish. These exchanges are part of a select group with sizeable trading volumes on a global scale. The designation of “deemed to be licensed” indicates that these exchanges are on track to receive full regulatory approval, pending consistent compliance with the SFC’s standards. As such, they must meet the set thresh of compliance to crypto regulations in HK.
However, not all major players in the cryptocurrency market are participating in this regulatory shift. Well-known exchanges such as OKX and Bybit have withdrawn their applications for licenses. Additionally, Binance Holdings, the world’s largest cryptocurrency exchange, has not applied for a license, nor have leading US-based platforms Coinbase Global and Kraken. It’s not clear whether the dissent is linked in any way to Hong Kong’s specific crypto regulations.
Hong Kong had set a strict deadline of June 1 for cryptocurrency exchanges to either obtain a license or be deemed to be licensed to continue their operations within the city. This requirement ensures that firms meet the minimum regulatory standards to market their services to local investors. Once these exchanges demonstrate ongoing compliance with the SFC’s regulations, they will receive their actual permits.
The move by Hong Kong to enforce these crypto regulations signifies its commitment to providing a secure and regulated environment for cryptocurrency trading. By ensuring that exchanges adhere to all regulatory standards, the SFC aims to protect investors and maintain the integrity of the financial system. If this plan succeeds, Hong Kong will strengthen its position as a key player in the global cryptocurrency landscape.
