- Hong Kong’s SFC unveils new rules for digital asset buying and selling platforms.
- A lot of the respondents positively assessed the proposed necessities.
- Failure to conform will consequence within the orderly closure of companies.
The Securities and Futures Fee (SFC), the impartial statutory physique liable for regulating the securities and futures markets in Hong Kong, has printed advisory opinions on proposed regulatory necessities for digital asset buying and selling platform operators licensed by the SFC. Throughout the session, the SFC acquired 152 written submissions, together with suggestions from business associations, market members and different stakeholders.
In accordance with the SFC, most respondents welcomed the proposed necessities, whereas some sought additional clarification. In response to the suggestions acquired, the SFC has modified and refined the proposed guidelines.
One of many key facets of the proposal is permitting licensed operators of buying and selling platforms to serve retail traders, which acquired robust help from respondents. To guard these traders, the SFC will introduce due diligence checks, enhance token verification, enhance governance, acceptance standards and disclosures.
Julia Leung, Govt Director of the SFC, emphasised the significance of setting clear regulatory expectations in selling accountable growth. Hong Kong’s complete regulatory framework follows the precept of “identical enterprise, identical danger, identical guidelines” to make sure robust investor safety and handle key dangers, promote sustainable progress and help business innovation.
From 2023 June 1 present tips will define varied necessities for operators of digital asset buying and selling platforms, together with secure custody of property, segregation of shopper property, avoidance of conflicts of curiosity and cyber safety requirements. The SFC will present additional steerage on the brand new regulatory necessities, together with license utility procedures and transitional preparations.
The SFC encourages operators of digital asset buying and selling platforms that want to adjust to regulatory requirements to use for a licence. In accordance with the SFC, those that select not to take action are anticipated to orderly shut their Hong Kong enterprise. As well as, the SFC will proceed to work with the Investor and Monetary Training Council to coach traders concerning the dangers of buying and selling on unregulated platforms.
