Hong Kong’s top regulator, Securities and Futures Commission (SFC) is expected to introduce new crypto regulation in the Special Chinese Zone to protect investors from fraud and insecure platforms according to chairman Carlson Tong Ka-Shing in a recent interview with South China Morning Post (SCMP).
The interview that took place earlier today saw the outgoing chairman Carlson Tong Ka-shing say that a blanket ban on cryptocurrencies like on Mainland China is “not necessarily the right approach” and SFC is not considering that at this time. But, at the same time, he did maintain that establishing a legal framework for regulation purposes is crucial because cryptocurrencies are based on new technologies and they cannot be treated as regular securities.
He said:
“It will not work in today’s internet world when trading can cross national boundaries. Even if we were to ban them, transactions can still be easily conducted via platforms in overseas markets.” He continued, “We need to see if and how these platforms can be regulated to a standard that is comparable to that of a licensed trading venue, while at the same time ensuring investors interest are being protected.”
According to SMCP, most of the exchanges operating in Hong Kong have welcomed the move. Hong Kong is home to some of the biggest exchanges in the world including Binance and Bitfinex and any regulations will affect many cryptocurrency traders around the world.
SFC is also deliberating Initial Coin Offerings (ICOs) and their relevant regulation but hasn’t made up its mind regarding them. While SFC has warned the public about the potential issues of ICOs but, has so far refrained from taking action on the matter. In July, the SFC declared that it was keeping a close watch on cryptocurrencies and ICOs and will intervene only when appropriate.
While Carlson’s views seem clear on the topic, he is soon to be replaced by Tim Lui Tim-leung as chairman of the SFC and not much is known about the new leader right now.
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