The Hong Kong Securities and Futures Commission (SFC) will inspect cryptocurrency trading platforms seeking licenses to operate as Virtual Asset Trading Platforms (VATPs). The inspections will start after the “non-contravention period” ends on June 1.
The SFC aims to ensure compliance with its regulatory requirements, focusing on client asset protection and know-your-client processes. Platforms failing these checks will have their licenses denied and face regulatory actions. Currently, 18 entities are “deemed-to-be-licensed” until the licensing process concludes. Only two firms, OSL Digital Securities Limited and Hash Blockchain Limited, hold full licenses.
Applicants that fail to meet requirements must submit a plan for an orderly business wind-down in Hong Kong. The initiative aims to protect consumers amidst rising crypto-related scams. This move underscores Hong Kong’s commitment to stringent regulatory oversight in the cryptocurrency sector.
