• Directory of Taiwan

Hong Kong market regulators get increased requests for crypto ETFs

Industry insiders see Hong Kong becoming crypto haven after China crackdown

An advertisement for the cryptocurrency Bitcoin displayed on a tram in Hong Kong. 

An advertisement for the cryptocurrency Bitcoin displayed on a tram in Hong Kong.  (AP photo)

TAIPEI (Taiwan News) — The Hong Kong Securities and Futures Commission (SFC) has received multiple requests from locally-listed companies about offering cryptocurrency exchange-traded funds (ETFs) in recent months.

Speaking at the sixth Hong Kong FinTech Week this week, Julia Leung (梁鳳儀), the deputy CEO of the SFC, hinted at a couple of issues the regulatory body is mulling over as it considers how crypto ETFs in the territory might go forward. Two issues are whether retail investors should be granted access to crypto ETFs through online brokers, and whether those individuals looking to invest in these ETFs should face extra restrictions compared to those investing in regular non-crypto ETFs, according to a report by Coindesk.

Under the current rules, service providers who offer cryptocurrency investing services must be registered in Hong Kong and can only work with “professional investors” — individuals with a portfolio exceeding US$1 million (NT$27.8 million) or firms with more than US$5 million in total assets. The crypto space has been monitoring to see which way Hong Kong will take regulation in the wake of China’s decision to crackdown on the technology in September, banning all transactions of cryptocurrency.

In a recent interview with Forkast media, Angelina Kwan, an ex-SFC regulator and current advisor to digital assets management firm HashKey Group, said Hong Kong will likely continue to be an interface between new Chinese blockchain technology and international users and investors.

"I think, going forward, Hong Kong will continue its autonomy and it’ll continue to maintain its autonomy in its financial and administrative affairs, which was granted in the Basic Law (the city’s mini-constitution). It’s also a major financial and business hub, so it makes sense for Hong Kong to continue as an interface for Chinese blockchain technology to find international uses and customers," Kwan said.

“There’s a new regime that will come, which will license other cryptocurrency or digital asset providers, and that’s under the money-laundering reporting ordinance,” Kwan said on new regulations. “So there’ll be a new regime there, slowly winding its way through legislation.”

Updated : 2022-01-22 19:44 GMT+08:00