In order to reestablish its position as the world’s cryptocurrency hub, Hong Kong under consideration Providing retail investors with access to cryptocurrencies, Crypto exchange trading fund (ETF)The move comes as we have seen an outflow of crypto startups to other markets such as Singapore and Dubai, following strict crypto regulations.
What is the difference in stances on cryptocurrencies between China and Hong Kong?
Hong Kong has been part of China since 1997 under the “one country, two systems” policy. Although Beijing controls Hong Kong’s foreign affairs and defense, it is still allowed to develop foreign relations in certain areas such as trade, communications, tourism and culture.
This system should allow Hong Kong to take a different approach to digital assets than China. In late September 2021, the People’s Bank of China (PBOC) will forbidden All cryptocurrency trading as part of an aggressive crackdown on the industry.
Following the ban, many cryptocurrency businesses moved to Hong Kong, which had already enjoyed its status as the world’s fintech hub. However, the city has seen an outflow of crypto businesses after a proposal to limit crypto trading to professional investors only.
The overall lack of clarity in the city’s stance on blockchain-based digital assets is another common complaint, seen as hurting Hong Kong’s status as an industry hub. Not to mention the stringent Covid-19 travel control measures that have led to cryptocurrency startups moving to other markets such as Singapore and Dubai.
Hong Kong Aims To Make Crypto Accessible For Retail Traders
Hong Kong has proposed allowing retail users to transact in cryptocurrencies as the city seeks to revive its fintech business.The announcement comes as the city recently did Bill unveiled to regulate crypto By 2023.
The principle of “one country, two systems” “forms the fundamental foundation of Hong Kong’s financial market” and the fact that Hong Kong can present its own bills to regulate cryptocurrencies is an indication that “Hong Kong will be freed from the mainland.” It shows how far apart we are,” said Elizabeth Wong. She is reportedly the director of licensing for the Securities and Futures Commission (SFC) and head of the fintech division.
Wong added that the SFC is considering allowing retail investors to “directly invest in crypto assets.” This marks a shift in the SFC’s stance on crypto over the past few years, in favor of limiting crypto trading on centralized exchanges to only professional investors with portfolios of at least $1 million. I was.
“We have four years of experience regulating this industry…we think it might actually be a good time to think carefully about whether to continue with this professional investor-only requirement. I have.”
However, some industry experts have expressed concerns about China’s ability to influence Hong Kong on issues related to digital assets. “What does it mean that Beijing won’t change its mind tomorrow and roll back all these positive crypto policies?” BitMex co-founder Arthur Hayes recently said: blog.
Hayes also said that access to Chinese customers is essential for Hong Kong to be attractive to cryptocurrency companies. “As crypto investors, we are interested in Hong Kong’s ability to facilitate Chinese capital needs,” he wrote.
This article originally appeared on tokenist
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