Press reports have emerged that the Hong Kong Monetary Authority (the central banking institution in the region) intends to establish a new regulatory regime for digital currencies by July of this year 2022.
The Special Administrative Region of China is ready to follow the path of Singapore to become a cryptocurrency hub for this part of the world.
Coming soon: Hong Kong crypto market regulatory framework launched
According to recent coverage byBloombergThe central bank in Hong Kong will approach the cryptocurrency industry in three ways:
- Protecting local investors.
- Create comprehensive rules for authorized institutions on how to handle digital assets.
- Special interest in stable cryptocurrencies.
The media coverage also stated that the Hong Kong Monetary Authority (HKMA) is willing to put stablecoins under close scrutiny.
In a recent press release, the corporation said that such assets present potential risks in terms of monetary and financial stability.
The central bank indicated that it was closely monitoring the development of these assets and would like to proactively share its views with the broader community.
Mr. Eddie Yu, CEO of the Capital Markets Authority said:
The central bank is awaiting feedback from stakeholders on the latest proposals.
We will establish a risk-based, practical and agile regulatory regime for the cryptocurrency industry.
Currently, the Special Administrative Region in China uses a so-called subscription base for local crypto exchanges, which means it can apply for oversight from the regulator.
Not long ago, Joshua Chu, a consultant at the law firm ONC, called this model ineffective, and the government should consider changing its policy.
In May 2021, local authorities intended to implement a rule that would only allow millionaires to trade in cryptocurrency (about 7% of the total population of the metropolis). At that time, Hong Kong Treasury Secretary Christopher Howe described this initiative as a well-considered decision.
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