Retail investors are anxious as they await the Hong Kong government’s proposal to ban them from crypto trading in the city. The Hong Kong government is proposing to ban retail crypto investors and make it compulsory for all virtual assets trading platforms to procure licenses. Without the license, trading platforms and retail investors will not operate in the city.
In August 2020, Hong Kong approved the country’s first crypto exchange.
According to the legislative proposal, only ‘professional investors’ would be permitted to trade crypto. Hong Kong’s Financial Services and Treasury Bureau first broached the subject late last year but just completed the three-month consultation period. After the consultation from industry participants and members of the public, the proposal will now become a bill and perhaps become a law.
Global Digital Finance, an industry body, says that if the proposal passes into law, retail investors will turn to unregulated platforms beyond the government’s reach. Industry insiders also confirm that if the proposed restrictions become law, companies and fintech talents may lose interest in Hong Kong. The companies may move on to countries with more crypto regulation-friendly laws.
Hong Kong’s proposed ban is aimed at empowering the Securities and Futures Commission(SFC). According to the proposal, the SFC will decide the requirements and conditions for licensing virtual assets providers. The regulator will also monitor the crypto market and reconsider crypto trade as the market grows.
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