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Hong Kong may license cryptocurrency firms by year-end

Hong Kong may issue virtual asset trading licenses to at least eight cryptocurrency-related firms by the end of the year, as part of the city’s new licensing regime.

According to Forkast News, the regulators are working on the new crypto licensing program set to take effect in June 2023. They include requiring firms to establish a listing committee to review tokens that the licensed Virtual Asset Service Provider (VASP) will be offering to their clients, requiring the appointment of an external advisor to review the VASP, specific security and internal controls as ensuring clients understand the virtual asset products.

For the new licensing regime, the SFC plans to require exchanges to apply for licenses that would allow retail investors to trade certain large-capitalization tokens. Non-fungible tokens deemed as securities will not be included in this specific license and it was likely that the SFC would publish another consultation paper about tokenization in due course, according to Kwan.

The city’s official said earlier that over 80 foreign and mainland China companies have expressed their interest in establishing Web 3.0 companies in Hong Kong ahead of new crypto regulations. Angelina Kwan, former regulator of the Hong Kong Securities and Futures Commissions (SFC) and chief executive officer of financial services firm Startford Finance estimated 8 eligible firms may be licensed. 

Internal controls are very important, by putting it in policies and procedures that they can actually follow. Security is key, and so is walleting system. They are requiring asset firms to have their own walleting system in place. That has to be as a part of the whole process now instead of separating it, unless you have a really good system in place, according to Kwan. 

Source: Forkast News


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