Hong Kong Government Proposal on Licensing Crypto Firms Ends Consultation Period

As part of a move to tighten anti-money laundering regulations, the Hong Kong government is moving to license virtual-asset service providers, a proposal that has now moved past its consultation period.

The Securities and Futures Commission (SFC) would be provided with “necessary intervention powers” to impose restrictions or even prohibitions on companies providing crypto services, according to an announcement Friday.
The aim will be for the SFC to protect clients against potential misconduct from virtual asset service providers.
The announcement today forms the conclusion of a consultation process that ran from November 2020 to the end of January 2021.
This news comes soon after self-regulatory organizations in China reiterated their stance on banning crypto services. The National Internet Finance Association, the China Banking Association and the Payment and Clearing Association of China published a note confirming bans originally implemented in 2013 and 2017 that bar any services related to cryptocurrency transactions.

Update (12:00 UTC, May 21, 2021): This article has been edited to add details of government announcement.

See also: OSL, Hong Kong’s First Regulated Crypto Exchange, Commences Live Trading