Hong Kong crypto exchange: SFC to regulate all crypto trading platforms

• Hong Kong SFC will be asking all crypto exchanges to register with them.
• Previously, only trading platforms dealing with security tokens were mandated for registration.

The Hong Kong Securities and Futures Commission (SFC) is raising its regulatory measure for crypto exchanges operating in the country. Last year, digital currency trading platforms could choose whether or not to subject their operations under the SFC’s regulatory radar. However, the regulator has today mandated the regulation of all crypto trading platforms in the region. 

SFC wants all crypto exchange regulated

According to the information by Reuters on Tuesday, the country’s securities regulator wants every digital currency trading platform to be registered with them. The chief executive officer of the Securities and Futures Commission, Ashley Alder, made this known today during the Fintech Week event. Alder emphasized that all the crypto exchanges ought to adhere to the requirements irrespective of whether they facilitate security token trading or not.

The development today could be seen as an amendment to the regulator’s approach in regulating the crypto exchange last year. Precisely on November 6, 2019, the SFC published a so-called “position paper,” mandating the need for digital currency trading platforms in the country to register with them for a license, that is, if they facilitate the trading of any securities token on their platform.

Hong Kong crypto regulation

The regulator mentioned at the time that it doesn’t have the power to license or regulate crypto exchanges that facilitate the trading of digital currencies alone, which are not categorized as securities. However, today’s statement from the SFC’s executive holds that all the crypto exchanges in Hong Kong will be regulated, not minding if they are dealing with or without security tokens. 

Before the position paper was published, the SFC released regulatory guidance for crypto fund managers in the country. The regulator outlined that all the cryptocurrency fund managers are required to have constant liquid capital of $387,024 (HK$ 3 million) at a minimum and an independent and functional custodian.