Hong Kong’s Securities and Futures Commission (SFC) is set to grant more digital-asset exchange licenses by the end of 2024 following a five-month review of exchanges operating under provisional permits.
Eric Yip, SFC’s Executive Director for Intermediaries, announced at the annual Fintech Week that a finalized list of fully licensed exchanges would be published by year’s end, according to a report from Bloomberg .
“The applicants and their controllers have by and large taken up our feedback, and they are willing to commit resources to rectify issues and take a long-term view in developing their business in a regulated environment,” Yip said.
EXPLORE: 15 Best No KYC crypto exchanges for 2024
Hong Kong Committed to Becoming a Crypto Hub
Yip’s comments signal Hong Kong’s commitment to becoming a digital asset hub after previous political upheavals impacted the city’s global appeal.
Since 2022, Hong Kong has positioned itself as a friendly environment for digital assets. However, progress on licensing has been slower than expected, with only three exchanges fully licensed to date and an additional 11 holding provisional “deemed-to-be-licensed” status under the current crypto regulation.
Since June, Hong Kong’s SFC has conducted on-site inspections of these platforms and found several practices that fell short of regulatory expectations.
The inspections revealed that some crypto firms are overly dependent on a limited number of executives for the custody of client assets, raising concerns about their ability to manage these responsibilities effectively.
🚨 Hong Kong ramping up crypto exchange licenses
– More licenses coming by EOY 2024
– 5-month inspection period complete
– Moving from provisional → full licenses
– Part of HK's push to become crypto hub— Token Dispatch (@tokendispatch_) October 28, 2024
Yip said that once the exchanges align with SFC’s recommendations, they will receive restricted licenses.
To fully lift these restrictions, exchanges must undergo third-party reviews in coordination with the SFC. Additionally, by early 2025, the regulator plans to establish a consultative panel with licensed exchanges to promote collaboration and guidance.
In another development, Hong Kong Exchanges and Clearing Ltd. unveiled plans on Monday to launch a Virtual Asset Index Series, providing regional benchmarks for Bitcoin and Ether pricing. The initiative aims to enhance cryptocurrency infrastructure in the Asia-Pacific timezone.
EXPLORE: 15 Best Anonymous Bitcoin Wallets with no KYC in 2024
Hong Kong Sees a Series of Exchange Closures
Hong Kong has been actively pursuing its vision of becoming a prominent crypto hub. The authorities have licensed two crypto exchanges that facilitate limited retail trading.
However, it is worth noting that the region has witnessed a series of crypto exchange closures as of late. On 28 March 2024, HKVAEX, suspected to be affiliated with Binance, withdrew its license application.
Subsequently, IBTCEX, QuanXLab, and Huobi HK followed suit, followed by Gate. HK, OKX HK and Bybit were next in line to withdraw applications.
These withdrawals have left only a handful of virtual asset trading platforms remaining on the application list, with a total of 13 companies having withdrawn or returned their license applications.
EXPLORE: 20 New Crypto Coins to Invest in 2024
Join The 99Bitcoins News Discord Here For The Latest Market Updates
