According to Julia Leung Fung-yee, the new CEO of Hong Kong’s Securities and Futures Commission (SFC), the new licensing scheme, which is due to launch in June, would limit retail trading in Hong Kong to “highly-liquid” digital assets.
Leung noted that several digital asset platforms had thousands of crypto and other digital products at the latest Asia Financial Forum. However, the SFC official did emphasize that they do not want to “allow regular investors to trade in all of them.” The SFC will instead establish requirements that restrict trading by retail traders to just significant virtual assets.
Leung noted that these would be “deep liquidity” assets even though the SFC chief did not go into further information regarding the specific assets that will be available for trade. The SFC official was questioned about Bitcoin but chose not to reply, only to restate that “highly liquid” assets will be permitted.
Leung emphasized that efforts are being made to establish Hong Kong as a hub for virtual assets, despite the restrictions that would be placed on ordinary investors. She stated that they wanted to improve Hong Kong’s status as a hub for virtual assets and establish a robust regulatory framework to protect the interests of all investors.
According to the CEO, a solid regulatory framework might avoid problems like the collapse of the FTX exchange in Hong Kong.
Paul Chan, the financial secretary, stated recently that numerous crypto companies want to open offices in Hong Kong . The representative emphasized that the government is making every effort to oversee the crypto industry appropriately and to utilize Web3 technology fully.
In the special administrative region, digital assets have recently gained a lot of attention. For example, a Hong Kong official proposed making the Hong Kong digital dollar a stablecoin on January 5. A legislative council member named Wu Jiezhuang thinks this could solve the dangers associated with digital assets in Web3.