TL;DR Breakdown
- Hong Kong’s Financial Service Authority to allow trading for just professional investors.
- Only investors with at least $1 milion will have the licence to trade.
The Chinese financial body in Hong Kong has increased efforts dedicated to imposing a crypto ban. The ban, according to reports, is specifically against Bitcoin retail or small-scale investors. However, industries are not supporting this decision, with Global Digital Finance the latest to debunk this ruling.
The proposed crypto ban is against retail investors, but professional investors still have the opportunity to trade. Speaking on the decision, the Chairman of GDF stated that the decision to ban retail investors is very different from what other countries do regarding cryptocurrency trading — adding that these countries give equal rights of trading for retail investors.
The Financial Services Authority in Hong Kong has revealed plans to release new directives for cryptocurrency trading, including the compulsory licensing of crypto exchanges. The proposed rule will be put in place to stop the high rate of scams in the country, according to the Authority.
Crypto ban: Only professional investors have the right to trade
The first phase of the new directive for cryptocurrency trading given by Hong Kong’s Financial Authority is very different from any regular anti-money laundering discipline. The ruling demands that any financial service only prioritize professional investors and that every activity will be strictly monitored.
The ruling will undoubtedly affect most Chinese citizens, particularly in Hong Kong, because not many have up to the specified amount to be a professional investor. By standards, only individuals with at least $1 million are referred to as professional investors.
Previously, China banned the trading of cryptocurrencies via banks, affecting cryptocurrency trading in the country. A proposed crypto ban on small-scale bitcoin investments may further cripple the business of crypto enthusiasts.
With Hong Kong in full support of the crypto ban ruling alongside the Chinese government, plans are already in place to release the new law by the end of the year. However, industries may be negatively affected by this verdict, as well as small-scale Bitcoin investors.
