Hong Kong’s main market regulator comes announcement they are relaxing crypto trading rules to boost activity in the city. Julia Leung of the Securities and Futures Commission said at Fintech Week that licensed crypto platforms can now connect local entities to their global order books instead of being stuck in a system confined only to Hong Kong.
This is actually a big deal because it brings cryptocurrency trading in line with how traditional assets operate locally. Hong Kong has been trying to become a regional crypto leader for three years with mixed results. They have a licensing regime for platforms, Bitcoin and Ethereum ETFs and digital asset funds, but trading activity still lags far behind countries like the United States, where Trump has been supportive of cryptocurrencies.
Leung admitted that they were “stricter” on regulation, but said that once they were satisfied that investors were protected, they would relax the rules as they just did with access to global liquidity.
The SFC is also finalizing rules for cryptocurrency broker and custodian licenses, while Hong Kong’s central bank will issue the first stablecoin issuer licenses next year. In the future, they are also considering letting licensed crypto brokers tap into global liquidity pools, although Leung did not give a time frame.
There are currently 11 fully licensed crypto exchanges with the SFCplus 49 brokers licensed to provide virtual asset services. The new rules could incentivize giants like Binance and Coinbase to set up shop with broker licenses.
Conclusion
Hong Kong allows licensed crypto exchanges to access global order books instead of Hong Kong-only trading, easing regulations to boost activity and rival crypto adoption in the United States.
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