Hong Kong wants to allow cryptocurrency retail sales

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  • In an effort to restore Hong Kong’s reputation as a fintech centre, the government has proposed enabling ordinary investors to trade in cryptocurrencies and crypto exchange-traded funds.

A number of start-ups have moved to other markets, such as Singapore and Dubai, after the city, which had earlier suggested restricting cryptocurrency trade to professional investors, received harsh criticism for planned laws for digital assets that would have stifled innovation.

Financial Secretary Paul Chan announced in a keynote speech to the Hong Kong Fintech Week conference that authorities would begin a consultation process on providing ordinary investors with “a suitable degree of access” to virtual assets.

“We want to clearly state our policy position to the world market and show our commitment to investigating fintech with the global virtual asset.

Industry insiders predicted that these actions would open the door for real estate security token offers (STOs). STOs are blockchain-based tokens that grant holders the right to receive income or dividends from actual assets or reflect ownership in those assets.

Additionally, the government will look into the legality of so-called smart contracts, which are self-executing transactions whose outcomes depend on pre-programmed inputs, and assess property rights for tokenized assets.

The most recent declaration would align Hong Kong’s regulations with those of Singapore, according to Andy Mahan, compliance officer and president of APAC at American cryptocurrency exchange Gemini.

“industry participants desire consistency in the worldwide regulatory environment because otherwise unscrupulous actors may be able to take advantage of loopholes in less strict legal regimes.”

Retail cryptocurrency trading is permitted in Singapore, however the country’s central bank has discouraged the general public from engaging in speculative cryptocurrency trading and placed limits on the promotion of cryptocurrency services in public spaces. ing. She also makes new recommendations. Hong Kong’s latest decision to authorize retail cryptocurrency trading will draw even more attention to the fact that both mainland China and Hong Kong have outright prohibited bitcoin trade.

Adrian Wang, CEO of cryptocurrency brokerage Metalpha, said: “This is a great move that sends a strong signal that Hong Kong is taking a different approach to regulating its capital markets.

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