Hong Kong’s securities regulator has announced a new plan to allow retail investors access to virtual asset platforms.
The Hong Kong Securities and Futures Commission (SFC) has announced that it will soon allow licensed platforms to offer their services to retail investors.
In a May 23 announcement by the SFC, the regulator said it would welcome applications for licenses from crypto asset trading platform operators willing to follow the SFC’s proposed guidelines.
Virtual asset trading platform policies include, but are not limited to, asset custody security requirements, cybersecurity standards, and customer asset segregation.
SFC CEO Julia Leung said setting clear expectations from regulators is “key” to creating a responsible and innovative development environment.
“Hong Kong’s comprehensive virtual assets regulatory framework follows the principle of ‘same business, same risks, same rules’ and aims to provide robust investor protection and manage key risks.”
The guidelines will go into effect in June 2023, but the SFC has yet to approve a crypto asset trading platform to serve retail investors. According to the notice, the SFC received 152 written submissions from industry during the consultation period.
The SFC also said it would introduce “a series of strong measures” to ensure the protection of retail investors. This includes good governance, suitability during the onboarding process, improved token due diligence, eligibility criteria and disclosure.
The announcement highlighted that most publicly available crypto asset trading platforms are not currently regulated by the SFC. He added that businesses reluctant to follow future guidelines should plan an “orderly closure” of their business operations in Hong Kong.
In an interview with Cointelegraph in early May, Hong Kong Fintech Association Chairman Neil Tan said the opening of the country’s financial industry to digital assets was “just a natural progression.”
On May 17, Chinese state-owned company Greenland applied for a virtual asset trading license in Hong Kong.