The outgoing chairman of the Hong Kong Securities Authority has lifted a ban on domestic cryptocurrency exchanges and instead proposed formal regulatory methods.
In light of increased demand for cryptocurrencies like Bitcoin among retail investors and traders, Hong Kong's Securities and Futures Commission (SFC) is developing liberal plans to regulate the market. Outgoing Chairman Carlson Tong Ka-shing said the Autonomous Self-Governing Administrative Region will not follow China's lead.
“We do not believe that imposing a complete ban on these platforms is the right approach,” said a senior official, adding that traders will always find workarounds. “And even if we ban them, these transactions can easily be carried out on foreign platforms.”
The SFC is seeking to create liberal rules for the functioning of domestic cryptocurrency exchanges, even though they are not within the regulator’s purview, since it only applies to securities. Tong emphasized that, according to SFC standards, cryptocurrencies do not fall under the definition of securities and futures.
He added: “We need to figure out what standards to adhere to when regulating such platforms, as well as protect the interests of investors.”
This proposal was warmly received by Hong Kong cryptocurrency exchange operators.
Earlier in March, authorities banned initial coin offerings, and the following month, SFC Deputy Chair Julie Leung called most ICOs “dubious activities, outright scams.”
According to ccn.com
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