Hong Kong regulators have emphasized the importance of self-regulation in the crypto industry, stating that many economically developed regions have established industry self-regulatory institutions to focus on industry development. As a result, the Hong Kong Securities and Futures Practitioners Association (HKSFPA) has recommended that crypto firms in Hong Kong establish a self-regulatory committee to ensure compliance.
In a letter dated 22 April, the HKSFPA highlighted that the local market for financial services in Hong Kong is solely focused on supervision and lacks an organization dedicated to ongoing industry development. The administrative body stressed the need for Hong Kong to remain competitive in the global securities market and solidify its position as an international financial center. To achieve this, the HKSFPA proposed that the city’s regulator, the Securities & Futures Commission (SFC), establish autonomous bodies that would delegate licensing powers to industry players.
The HKSFPA suggested that the SFC should continue to oversee market conduct but delegate licensing authority to a securities industry composed of the futures industry, asset management industry, and virtual assets industry. This approach would strike a balance between development and oversight, ensuring that the industry can flourish while maintaining regulatory standards.
In contrast to other global regulators, Hong Kong has been relatively lenient towards virtual asset firms. On April 15, the SFC approved Bitcoin and Ether trading exchange-traded funds for issuers such as Harvest and Bosera. Additionally, China Asset Management (ChinaAMC), a state-owned asset manager, received approval. Last year, OSL and Hashkey were granted official virtual dollar exchange licenses.
Meanwhile, the Securities and Exchange Commission in the United States has not yet allowed a spot Ether ETF or granted licenses to cryptocurrency exchanges, apart from the three licenses it has issued. The regulatory landscape for cryptocurrencies in the US is still uncertain.
