Encouragement for Coinbase and other companies to apply for licensing in Hong Kong.
The Hong Kong Legislator, Johnny Ng, has suggested that Coinbase and other global exchanges should establish themselves in the region. The legislator made this suggestion on Twitter and offered his assistance to Coinbase and other interested parties in registering and developing their businesses in the former British colony.
Mr. Ng is known for his optimistic views on Web3 technology, having previously co-founded a Web3 accelerator. His call for virtual asset trading platforms to come to Hong Kong coincides with a recent clampdown by the US SEC on major players like Coinbase and Binance.
Last week, the commission charged Binance and Coinbase with violating securities laws and operating unregistered entities. This lawsuit has had a significant impact on the crypto industry, with many uncertain about the regulator’s position. Similar to the United States, many other Western countries have taken a cautious approach to cryptocurrencies. However, the situation in Hong Kong is different.
Hong Kong’s Call for Coinbase is Part of a Larger Plan
In 2017, when Mainland China banned crypto exchanges, and in 2021, when cryptocurrency trading was banned, Hong Kong did not follow suit. However, the city lost its position as a cryptocurrency hub. In 2022, Hong Kong declared its readiness to do business with the digital asset industry.
- BitGo to acquire Prime Trust Custody Firm.
- Meta to launch ‘Channels’ broadcasting tool for WhatsApp.
- Robinhood examining SEC-designated security tokens.
Since making this announcement, the city has been proactive in formulating regulations and compliance measures to facilitate the growth and expansion of the cryptocurrency industry. According to Eddie Yue, the chief executive of the Hong Kong Monetary Authority, the city aims to become a global hub for the crypto industry.
The new policy has attracted several crypto trading platforms to the city, but only two exchanges, OSL Exchange and Hashkey Pro, had successfully registered with the SFC by the end of May. Others like Huobi announced that the application was in process, while OKX noted that it would offer crypto trading to Hong Kong residents through its app. The legislator’s recent invitation may be what the city needs to attract more interest from crypto trading platforms.
Mainland China Maintains Its Stance
While Hong Kong welcomes cryptocurrencies, digital asset trading remains banned in Mainland China. However, a Bloomberg report suggests that Beijing may be open to the idea of Hong Kong becoming a crypto hub.
Nevertheless, Hong Kong still has many hurdles to overcome if it is to become a globally recognized crypto hub. The city would also face competition from Japan, South Korea, and Singapore, which already have more elaborate regulations.