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Hong Kong’s securities and futures commission is not going to ban cryptocurrency platforms

Hong Kong’s securities and futures commission (SFC) is planning to introduce crypto regulation to protect investors, the SFC chairman Carlson Tong Ka-shing told newspaper the South China Morning Post (SCMP) on October 15.

Carlson Tong Ka-shing, who will pass his position in the SFC to Tim Lui Tim-leung on October 19, said that the watchdog is not considering a ban on cryptocurrency platforms as the Chinese mainland has done, adding that they don’t think that a total ban is “necessarily the right approach”:

“It will not work in today’s internet world when trading can cross national boundaries. Even if we were to ban them, transactions can still be easily conducted via platforms in overseas markets.”

Carlson Tong Ka-shing added that a legal framework to regulate cryptocurrency exchanges is absolutely necessary, noting that the SFC is going to consider the approach carefully as such platforms are “new technologies” and cannot treated as securities. Despite the fact they do not fall under the SFC’s current requirements, Tong proposes equating them to traders:

“We need to see if and how these platforms can be regulated to a standard that is comparable to that of a licensed trading venue, while at the same time ensuring investors interest are being protected.”

As per the SCMP, the exchanges that are working in Hong Kong’s market have welcomed the move. For instance, BitMEX chief operating officer Angelina Kwan told the newspaper that the regulatory authority can help to develop a new industry. And Circle’s CEO Jeremy Allaire said the company will proactively work with the government on those frameworks.