The Hong Kong Securities and Futures Commission (SFC) today released a consultation conclusion on proposed regulatory requirements for virtual asset trading platform operators. The document outlines key public feedback and the SFC's responses. According to the announcement, platform operators may apply for licenses with the SFC after the Guidelines for Virtual Asset Trading Platform Operators take effect on June 1. SFC officials stated that retail investors could begin trading virtual assets on licensed platforms as early as the second half of 2023.
Platform Operators Can Apply for SFC Licenses Starting June
Following a public consultation in February 2023 regarding proposed regulations for virtual asset trading platforms, the SFC today published the consultation conclusion, detailing public feedback and revised regulatory proposals.
Key points:
- Multiple virtual asset-related guidelines will be gazetted on May 25.
- The Guidelines become effective on June 1, after which operators may apply for licenses.
- The SFC emphasized that no platforms are currently approved to serve retail investors, and all publicly accessible crypto trading platforms remain unregulated by the SFC.
New Rules: No Gifts for Users and Strict Token Listing Requirements
The SFC’s consultation document highlights several investor protection measures:
- Retail Investor Safeguards: Licensees must comply with client onboarding, governance, disclosure, and token due diligence requirements before serving retail users.
- Advertising Ban: Platforms cannot offer gifts (except fee discounts) or advertise specific virtual assets.
- Token Listing: Each token must undergo due diligence, including independent smart contract audits where feasible.
- Stablecoin Restriction: Stablecoins will not be available for retail trading until regulatory frameworks are implemented (expected 2023/24).
Retail Trading Expected by Late 2023
According to RTHK, SFC Interim Head of Intermediaries Timothy Chui projected that licensed platforms might offer retail services by the second half of 2023, pending the Guidelines’ implementation.
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FAQ Section
Q1: When can virtual asset platforms apply for SFC licenses?
A: Applications open on June 1, 2023, after the Guidelines take effect.
Q2: Can retail investors trade crypto now in Hong Kong?
A: No. Currently, no SFC-licensed platforms are authorized to serve retail investors.
Q3: Are stablecoins allowed for trading?
A: Not yet. Stablecoins will be restricted until Hong Kong’s regulatory framework is established.
Q4: What are the key requirements for token listings?
A: Platforms must conduct due diligence and preferably hire independent auditors for smart contract reviews.
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Keywords: Hong Kong SFC, virtual asset license, crypto trading platform, retail investors, stablecoin regulation, token due diligence, June 1 2023
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