Singapore has awarded 13 cryptocurrency licenses to major industry players, including OKX, Upbit, Anchorage, BitGo and GSR, over the past year. This represents more than double the licenses issued by the city-state in 2023.
Meanwhile, Hong Kong’s efforts to establish itself as a cryptocurrency-friendly financial hub have lagged behind, with the licensing process moving at a slower pace.according to a recent Business Standard report.
Both Singapore and Hong Kong aim to attract digital asset businesses through dedicated licensing regimes, tokenization initiatives and regulatory sandboxes. However, cities’ progress in achieving these goals has been uneven.
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Hong Kong only authorized seven platforms
While Singapore’s streamlined approval process has made it a favored destination, Hong Kong has only been granted a full license for seven platforms, four of which received restricted approvals in December.
Several leading exchanges, including OKX and Bybit, have withdrawn their applications in Hong Kong, citing regulatory concerns.
Hong Kong’s stricter rules, only allowing trading in highly liquid cryptocurrencies like Bitcoin and Ether, have further limited its appeal. The exclusion of smaller tokens, called altcoins, limits opportunities for crypto companies seeking greater market exposure.
China’s influence also weighs heavily on Hong Kong’s cryptocurrency ambitions, as the mainland’s blanket ban on cryptocurrency trading creates a unique risk profile for the city.
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Hong Kong SFC approves and lists four new #Bitcoin and cryptocurrency trading platforms.
China is preparing
– Bitcoin Magazine (@BitcoinMagazine) December 18, 2024
Hong Kong SFC approves and lists four new 
On the other handSingapore offers a more stable and favorable environment for digital asset businessesaccording to David Rogers, regional CEO of market maker B2C2 Ltd. He described Singapore as a “safe, long-term choice”» due to its balanced regulatory approach.
Both cities have made progress in driving institutional adoption of blockchain. The Monetary Authority of Singapore launched Project Guardian and Global Layer 1 in November to advance asset tokenization.
Meanwhile, Hong Kong facilitated the sale of $770 million in digital green bonds using HSBC’s tokenization platform.
Despite these efforts, Hong Kong’s attempts to generate enthusiasm for digital asset products have failed. The city’s spot Bitcoin and Ether ETFs, launched in April, attracted just $500 million in assets, far behind the $120 billion managed by similar products in the United States.
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Hong Kong Speeds Up Crypto Regulation
Recently, the Hong Kong government announced plans to implement a mandatory reporting framework for crypto assets by 2026.
The proposed framework for reporting crypto assets will require taxpaying residents In the country to annually report their crypto accounts and transactions.
In addition, Hong Kong also said it was being deployed a plan to exempt private equity funds, hedge funds and investment vehicles of ultra-wealthy individuals from tax on gains from cryptocurrencies, private credit investments and other assets.
The proposal states that taxation is “one of the key considerations” for asset managers when choosing where to locate their operations. By creating an “enabling environment,” the Hong Kong government aims to attract global investors and crypto businesses.
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