Hong Kong is set to enhance its cryptocurrency market transparency and security by introducing a regulatory framework for over-the-counter (OTC) crypto trading platforms, as announced by the Financial Services and the Treasury Bureau (FSTB).
Hong Kong is taking a big step towards regulating crypto trading, specifically for over-the-counter (OTC) platforms.
Announced by the Financial Services and the Treasury Bureau (FSTB), this move aims to make the digital asset market more transparent and safe for everyone.
The government plans to release a consultation document soon. This is important because OTC trading platforms have been linked to fraud, especially with unlicensed virtual asset (VA) trading platforms.
Christopher Hui, the Secretary for Financial Services and the Treasury, pointed out that these platforms have been part of some fraud cases, misleading investors to put money into unlicensed platforms.
To prevent such issues, the proposal suggests bringing OTC venues under strict rules. The goal is to ensure these platforms are regulated and monitored properly, to protect investors and make sure they offer a fair trading environment.
Hong Kong has been actively working on crypto regulation.
Six months ago, the Securities and Futures Commission (SFC) made it safer for retail investors to enter the crypto market by upgrading a local exchange, HashKey, to offer regulated services.
They also considered allowing individuals to invest in crypto ETFs, aiming to position Hong Kong as a top digital asset hub in Asia-Pacific.
Following the U.S. SEC’s approval of some BTC ETF applications, Harvest Fund Hong Kong applied for a Bitcoin spot ETF with the SFC.
This could be a significant step for the region’s financial market, with the ETF possibly being listed on the Hong Kong Stock Exchange soon after the Chinese New Year.