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Hong Kong, the financial center of Asia, has taken serious steps in preparation for the future internet era and web3, including moves directly related to cryptocurrencies. However, due to the presence of malicious actors in this field who represent the dark side of the industry, new steps were needed.
Cryptocurrency Measures in Hong Kong
The Securities and Futures Commission (SFC) of Hong Kong is increasing its measures following the JPEX fiasco. Many cryptocurrency exchanges have defrauded millions of investors so far. The recent FTX incident resulted in such a massive loss that even politicians like Biden went so far as to blame crypto. We even saw some politicians promising to ban crypto to prevent such losses.
Abuses lead to the establishment of new boundaries in law. For example, with the introduction of the internet into our lives, we have seen legislation related to global-scale cyber fraud or hacking crimes. The same applies to crypto. There is something new, and governments have to build their own fences to protect their citizens.
After the JPEX case, the SFC understood the seriousness of the situation and started to intensify its regulatory measures.
Important for Cryptocurrency Exchanges
Hong Kong, the EU, and the US have taken various steps in the field of crypto. These steps are being taken in different areas. The days when all of them will turn into a global standard are not far away. The SFC has now announced its intention to provide transparent tools for investors using cryptocurrency exchanges (VATPs). The statement read as follows;
“The Securities and Futures Commission (SFC) and its subsidiary, the Investor and Financial Education Council (IFEC), are working closely together to educate and warn investors about the risks of trading on unregulated platforms. In light of the recent concerns in the public regarding unregulated virtual asset trading platforms (VATPs), the SFC is implementing a series of measures to enhance information dissemination and investor education.”
The SFC will take measures to enable investors to distinguish between licensed and unlicensed cryptocurrency exchanges, and the first publication of VATP lists is expected. Platform awaiting license approval will also be announced to investors.
As of today, there are only two platforms in the region with service licenses: OSL Exchange and Hashkey Exchange. SFC officials said that the risks of such platforms became more apparent after the JPEX incident.
