Hong Kong’s Securities authority published its proposed rules for virtual asset trading platforms and is seeking public comments before the final regulation is approved, reported TechCrunch.
Hong Kong proposed rules that would allow retail investors to trade certain “large-cap tokens” on licensed exchanges. This is very different to the rules found in mainland China across its border, where crypto-related transactions are banned.
Under the new regime, all crypto trading platforms planning to apply for a license – including pre-existing platforms – “should begin to review and revise their systems and controls to prepare for the new regime,” the notice said.
Related: Hong Kong Looks At Authorizing Crypto ETFs
“Those which do not plan to apply for a license should start preparing for an orderly closure of their business in Hong Kong,” it added.Hong Kong is also planning to regulate stablecoins starting in June this year.
The proposal laid out by Hong Kong stipulates that all centralized virtual currency exchanges operating in the city or marketing services to the territory’s investors must obtain licenses from the Securities and Futures authority. The requirements “cover key areas such as safe custody of assets, know-your-client, conflicts of interest, cybersecurity, accounting and auditing, risk management, anti-money laundering/counter-financing of terrorism and prevention of market misconduct,” the announcement reads.
