2 years ago
The Securities and Futures Commission (SFC) of Hong Kong has issued a informing to unlicensed providers of crypto trading services. Concerned astir their engagement successful “improper practices,” the regulator besides said investors should beryllium alert that immoderate of these platforms whitethorn ne'er really use for oregon get a license.
Hong Kong’s SFC Threatens Crypto Exchanges Abusing Transitional Arrangements Under New Licensing Regime With Legal Action
In a announcement published Monday, Hong Kong’s securities and futures regulator said that immoderate unlicensed virtual plus trading platforms (VATPs) person been engaged successful what it called “improper practices.” The SFC warned the crypto firms astir “potential ineligible and regulatory consequences.”
The Commission explained that portion definite exchanges assertion to person submitted licence applications they person not done truthful successful fact, giving users a mendacious content that they are successful compliance with regulatory requirements. The SFC warned that making specified misrepresentations is an offense.
On June 1, Hong Kong launched a caller licensing authorities for crypto work providers arsenic portion of efforts to reconstruct its credentials arsenic a starring fiscal halfway by becoming a hub for integer assets. While making this crypto-friendly move, the portion indicated that companies should expect tight rules.
Transitional arrangements were enactment successful spot to springiness VATPs that were operating successful Hong Kong earlier June 1, 2023 clip to hole for compliance with the requirements nether the caller licensing authorities and they were allowed to proceed to supply services until May 31, 2024.
The SFC said it recovered that immoderate unlicensed VATPs had acceptable up caller entities to supply crypto services successful Hong Kong, announcing intentions to use for licenses for them. However, the services and products offered by immoderate of these entities whitethorn not beryllium successful compliance with the requirements, the regulator noted.
The Commission besides noticed that immoderate unlicensed virtual plus work providers proceed to motorboat caller services and products nether their existing entities that whitethorn not comply with the applicable ineligible and regulatory requirements.
“For example, they may, nether caller oregon existing entities, motorboat definite virtual assets for trading by retail clients, trading services successful virtual plus derivatives, oregon arrangements involving virtual assets specified arsenic virtual plus ‘deposits,’ ‘savings’ oregon ‘earnings’ which are not allowed nether the caller regime,” the SFC explained and stated:
These non-compliant activities whitethorn rise concerns astir the VATPs’ volition to comply with the SFC’s ineligible and regulatory requirements and fittingness and properness to beryllium licensed, amongst different issues.
Conducting unlicensed activities successful Hong Kong is simply a transgression offense, the securities regulator emphasized. It besides highlighted that astir VATPs presently accessible by the nationalist are unregulated and may, oregon whitethorn not, taxable a licence exertion successful the end. The SFC warned investors to beryllium wary of the risks of trading connected an unregulated level specified arsenic losing the integer assets they clasp connected it if it ceases operations.
Do you deliberation Hong Kong volition prosecute cryptocurrency exchanges violating its caller regulations? Share your thoughts connected the taxable successful the comments conception below.
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