Reasons Hong Kong Will Lift Crypto Trading Ban

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Reasons Hong Kong Will Lift Crypto Trading Ban. Hong Kong will lift a ban on retail cryptocurrency trading as the city seeks to restore its reputation as a leading fintech hub.

The Securities and Futures Commission (SFC) concluded its consultation on regulations for digital asset platforms and announced that licensed entities will be allowed to offer services to retail investors.

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SFC will introduce measures to protect retail investors, including a thorough vetting process for tokens prior to their listing on exchanges.

This decision is a reversal of the restrictions imposed last year. Meanwhile, the new regulation is expected to come into force on June 1, 2023.

The SFC consultation period involved gathering feedback from industry stakeholders, most of whom welcomed the requirements put forward.

Launching the Crypto News page, Wednesday (24/5/2023), the regulator has decided to give licensed virtual asset providers the opportunity to serve retail crypto investors, marking a significant policy shift.

Reasons Hong Kong Will Lift Crypto Trading Ban. However, smaller investors need to meet certain obligations, such as undergoing investor training and demonstrating an awareness of potential risks.

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SFC emphasizes the importance of good governance, strong onboarding processes and transparent disclosure practices as part of safeguard measures.

While SFC will not publish a list of approved assets for retail investors, platform operators are reminded of their legal obligation to ensure compliance with Hong Kong public offering regulations. The decision to lift the ban on retail trading comes in response to the flight of crypto startups to competing jurisdictions, particularly Singapore, which has a more favorable regulatory environment.

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