Hong Kong securities regulator warns of ‘criminal’ activity by unlicensed exchanges

The Securities and Futures Fee (SFC) of Hong Kong issued a discover about unlicensed digital asset buying and selling platforms “participating in improper practices,” warning of potential felony prices.

In an Aug. 7 discover, the SFC stated sure buying and selling corporations had falsely claimed to have submitted purposes for licenses in Hong Kong. The securities regulator stated ought to the businesses really apply to function legally within the particular administrative area, it will take into account any false statements in addition to potential felony prices.

In accordance with the SFC, some unlicensed crypto buying and selling platforms in Hong Kong arrange new entities, claiming to have submitted purposes to the securities regulator. Nevertheless, “the providers and merchandise provided by a few of these new entities might not be in compliance with the authorized and regulatory necessities” underneath the SFC’s guidelines that grew to become efficient as of June 1.

“These established entities may even want to use for SFC licences or they need to proceed to shut their enterprise in Hong Kong,” stated the monetary watchdog. “Conducting unlicensed actions in Hong Kong is a felony offence.”

Associated: Hong Kong wouldn’t go crypto with out China’s approval — Animoca exec

Sure crypto corporations, together with HashKey and OSL, have acquired licenses underneath the SFC’s regime, permitting the platforms to supply quite a lot of crypto providers to Hong Kong residents. The licensing regime requires crypto exchanges and repair suppliers to make sure secure custody of property in addition to observe Know Your Buyer, Anti-Cash Laundering and Combatting the Financing of Terrorism guidelines, amongst others.

Journal: DeFi faces stress check, DoJ fears run on Binance, Hong Kong’s crypto buying and selling: Hodler’s Digest, July 30 – Aug. 5