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The Brighter Side Of The Cryptocurrency Regulations In Hong Kong

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By Author: Sanchit
Total Articles: 43
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A set of new regulations concerning cryptocurrency related companies were announced by Hong Kong’s Securities and Futures Commission (SFC) in November 2018. Since then the entire crypto world is in buzz about the same. However, the majority of them failed to portray the positive side of these regulations.

Hong Kong has emerged as one of the most fertile lands for the Cryptocurrency Industry. Unlike the mainland China, Hong Kong has welcomed the crypto industry and facilitated its growth. The country has shaped its rules different from China which made it the one stop destination for businessmen and entrepreneurs.

How is Hong Kong different from mainland China?

Hong Kong’s constitutional principle is “One country, two systems.” This gives Hong Kong rights to devise its own laws, rules and regulations without any interference from the Chinese Authority.
Hong Kong has utilized this principle to design its laws to welcome and facilitate business growth in the land. Unlike China, Hong Kong has embraced cryptocurrency and has stood out as one of its hubs. Crypto trading in Hong Kong has bloomed and flourished with time making it a thriving place for ICOs and crypto-exchanges.

What are the latest Crypto regulations in Hong Kong?

The regulators of Hong Kong’s security showed its concern about the cryptocurrency exchanges in Hong Kong in November 2018. The SFC put forward new regulations for cryptocurrency in the country this year. This implied that now trading in Cryptocurrency will be monitored contrary to the older times.

According to Securities and Futures Commision, fund managers who invest more than 10% of their assets in cryptocurrency will require a license by SFC in one way or the other. Furthermore, one must be in contact with a professional investor to sell crypto related products.

The bitcoin regulations in Hong Kong also extend to the ICOs. After the implementation of these new crypto regulations in the country, companies wishing to launch their ICO will be required to meet SFC’s requirements. One of these requirements being that the ICO should have existed for at least 12 months.

Apart from this, exchanges will now come under the monitoring of SFC. They will be required to produce a regular report and cooperate in SFC’s regular inspections.

How these rules can be considered “good”?

As pointed out by several experts, these new rules will impose a number of restrictions in the crypto industry in Hong Kong. Although, these rules will pose a threat to the freedom of cryptocurrency in Hong Kong, but at the same time they will ensure the security of the investors, sub-brokers and freelancers. These rules and regulations will come out as a sieve, helping Hong Kong to be clear of all the impurities in its crypto world.

By making the involvement of professional investors a compulsion, the Hong Kong authorities aim to protect investors from the mis-representators of the crypto world. Such rules will not only reduce the anxiety and worries in the minds of crypto investors but also help them get better returns.

With regulations implemented on ICOs, SFC would keep a check on its number, narrowing it down to the best ones. This will give investors to choose from well rooted and established ICOs and at the same time will reduce the crowd in the market.

Moreover, the Hong Kong Authorities wish to keep exchanges under supervision. This will protect the investors from the unnecessary complications and problems. At the same time it will also force exchanges to keep rules and regulations in mind while working.

These rules come up as new and burdensome for some exchanges. But with new cryptocurrency regulations in Hong Kong
cryptocurrency regulations in Hong Kong, it will become even safer and more fruitful in terms of cryptocurrency business. With or without these rules, Hong Kong was, is and will always remain a thriving land for cryptocurrency and startups.

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