- Licensing program will permit Hong Kong retail trading.
- Hong Kong includes setting up a mechanism to approve exchange-traded funds.
Hong Kong is turning toward a friendlier regulatory framework for cryptocurrencies with a plan to authorize retail trading. Retail trading will be permitted via a planned required licensing program for cryptocurrency platforms, which is expected to go into effect in March upcoming year.
The plans come despite the city’s skepticism of previous years and the prohibition in mainland China. According to the report from Bloomberg, regulators would like to enable listings of more significant tokens but it has yet to include particular coins like Bitcoin (BTC) or Ethereum (ETH).
Hong Kong Steps Towards Digitalization
According to Elizabeth Wong, the fintech head of the city’s Securities and Futures Commission, other potential steps in Hong Kong include setting up a mechanism to approve exchange-traded funds offering exposure to popular digital assets.
Also, the government is intended to expand on its previously stated objective of developing a leading crypto hub. The initiative is a considerable effort to rebuild Hong Kong’s reputation as a financial hub. Still, the specific timeline has yet to be finalized.
In 2018, the city implemented a mandatory licensing system that limited access to cryptocurrency platforms to customers with portfolios worth at least HK$8 million ($1 million). But currently, Hong Kong has been attempting to create a complete crypto regime that goes beyond retail token trading.
However, due to the cryptocurrency market’s volatility, the adoption of Central Bank Digital Currency (CBDC) has increased in Hong Kong. Further, the Monetary Authority recently revealed the Aurum retail central bank digital currency’s final edition on October 21. The system represents the complex nature of Hong Kong’s present monetary system.
