Hong Kong Is Becoming A Home For Cryptocurrency Gradually
In the last few months, Hong Kong city has been bursting with a lot of energy for cryptocurrency. Ranging from trailing the central bank digital currency (CBDC) to allowing crypto retail trades, the city is gradually becoming a potential global hub for cryptocurrency.
According to the report, Hong Kong has been busy with many events, especially in May, as it welcomes many crypto-friendly changes. In addition, the city added many crypto-friendly regulations to its Constitution.
Paul Chan Mo-Po, the financial secretary of Hong Kong, revealed recently that the city plans to adopt a regulation that encourages growth in the digital assets industry.
In a blog post, Paul admitted that the crypto market has been highly volatile, and this has caused many cryptos to go bankrupt and run out of business. Consequently, many entities are skeptical about venturing into the fastest-growing crypto and Web3 innovation.
However, the secretary pointed out that now is the right time to jump on the moving train of Web3. He added that Hong Kong city is committed to promoting this technology to become a central hub for crypto and Web3 in the Asia region and globally.
Hong Kong Took A Lot Of Positive Steps
Recently, Hong Kong’s CSTCB (Cyber Security and Technology Crime Bureau) deployed a metaverse protective platform dubbed the CyberDefender Metaverse. The platform aims to educate Web3 users on the risks and benefits embedded in Web3 technology.
During the launch, CSTCB stated that the decentralized nature of the crypto assets unconsciously facilitates many cyber crimes that target smart contracts, digital assets, wallets, etc., with the sole aim of stealing victims’ funds.
In addition, the Police Force of Hong Kong expressed their worries that the increasing use of crypto and Web3 could make cybercrime more rampant. For instance, in the Q1 of 2023, the law enforcers recorded about 663 cases of crypto-related thefts and scams, where victims lost about $570 million.
Furthermore, in the press release, the department revealed that CyberDefender is a great tool that can help prevent cyber crimes. It allows users to post and search any URL, phone number, or email on the police database to ascertain if it has been linked with a previous crime.
Meanwhile, the Hong Kong SFC (Securities and Futures Commission) recently concluded its consultation exercise, which allowed stakeholders to submit opinions on the commission’s plans. About 150 submissions were made, and the bulk of them approved the proposed requirements from the commission.
As such, the SFC would begin to offer licenses to digital assets services providers to operate in the region. Consequently, this means the city has lifted the bans on retail trading, which it imposed last year. According to the report, the changes made to the constitutions would take effect from June 1, 2023.
All crypto platforms willing to operate in the region must abide by the regulations stated in the new framework. In addition, the law mandated smaller investors in the area to go through investor training and understanding of vulnerability risks.
Crypto Startups Flux Into HK, CBDC Trials Continue
Crypto exchanges move to Hong Kong
Since the city announced the series of positive changes, there has been a new wave of attraction to the town from crypto platforms globally. Many crypto startups are interested in getting licensed to operate in the city.
For instance, the Huobi exchange has registered with SFC to offer crypto assets, including BTC and ETH, trading services in the region. In addition, Gate.HK, a branch of Gate.io, launched its trading services in May.
Other giant crypto exchanges like OKX and BitMEX are not left behind. They have also indicated their choice to open branches in Hong Kong, providing its citizens with crypto trading services.
Meanwhile, the city is currently working on building its central bank digital currency, dubbed the Cyber Hong Kong Dollar (e-HKD). In May, the Monetary Authority of Hong Kong announced that the city is currently trialing the utility cases of the proposed e-HKD.
About sixteen banks and payment firms have been selected by the authority to oversee the trial. The authority hinted that some overseers would determine if the project would continue to the next phase.
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