The Securities and Futures Commission (SFC) of Hong Kong has published a report on “Regulation for Quality Markets”. A statement from the executives read that the country will “keep a close watch on cryptocurrencies and initial coin offerings, intervening where appropriate.”
The SFC plans to observe and monitor the crypto industry in order to ensure that investors don’t end up risking their assets. Its fintech advisory board also met up twice this year in order to hold talks about blockchain and cryptocurrencies.
We also launched the SFC regulatory sandbox for qualified firms to conduct regulated activities utilising financial technologies.
The report noted that some cryptocurrencies are considered to be securities and are subject to Hong Kong’s securities laws. Last year in September, the SFC warned investors regarding the risks attached to cryptocurrencies and ICOs in a circular. Once again, in December, a statement was released which talked about crypto-related products and derivatives.
The SFC also published a similar warning in February 2018, which led an ICO creator to halt their activities in Hong Kong. In March, the Financial Services and the Treasury Bureau (FSTB) published a report that clarified that Bitcoin didn’t pose a ‘serious’ threat to the country. They added that the “threat level”, for cryptocurrencies to be used in criminal activities, was low.
[T]here does not seem to be any visible impact affecting the overall risk in Hong Kong so far. The risk of VCs [Virtual Currencies] is assessed as medium-low.
Meanwhile, financial services company Ant Financial has partnered up with British multinational banking company Standard Chartered to offer remittance services between Hong Kong and the Philippines. The Hong Kong Exchange and Clearing Market (HKEX) is also in talks with Australian Securities Exchange (ASX) to learn how to use blockchain technology to reduce costs. Currently, the country is home to seven Bitcoin ATMs and four online Bitcoin exchanges.