Hong Kong Continuing To Double Down On Crypto

Hong Kong has been one of the most crypto-friendly regions, and the trend seems to be continuing despite other jurisdictions taking a step back. Neil Tan, the chair of the FinTech Association of Hong Kong (FTAHK), recently confirmed that Hong Kong is still enthusiastic about providing citizens access to crypto trading. In fact, it’s taking the lead in this area while other regions like Singapore and the U.S. are slowing down.

Hong Kong is all set to launch a licensing regime for crypto exchanges on June 1st, which will include retail trading. This is good news for crypto enthusiasts, as access to crypto in a legal and regulated way is critical to expanding their use. Tan believes that if there is access to cryptocurrency in a legal and regulated manner, then participants will come. He stated that the current options are dwindling, and therefore, having legal and regulated access is critical for the growth of the crypto industry.

In February, Hong Kong’s securities regulator proposed allowing retail traders access to licensed crypto platforms in its licensing regime proposals for Virtual Asset Service Providers (VASPs). It highlighted that denying access could push traders to unregulated overseas platforms, which could have dangerous consequences. Currently, these platforms can only serve accredited professional investors, and denying access to retail traders could push them away from the region.

While providing a regulatory framework for crypto is crucial, Hong Kong is also focusing on attracting talent and infrastructure providers to support the industry. Tan believes that both the Chinese and Hong Kong governments recognize the opportunities in the region and are taking action to support inbound talent. In fact, there is a lot of talent across the border, and with the region facing a fair amount of unemployment, many are willing to move to Hong Kong to capitalize on the opportunities in the crypto industry.

The opening of the financial industry to digital assets is a natural progression, according to Tan. Cryptocurrencies are becoming more and more popular and are being adopted by people across different portfolios, including retail, high net worth, and institutional investors. Therefore, Hong Kong’s move to include retail trading in its licensing regime is a step in the right direction.