Hong Kong Regulator Vows to Closely Follow Crypto Market

Despite taking regulatory action towards digital currency exchanges and Initial Coin Offering holders earlier this year, the Hong Kong Securities and Futures Commission (SFC), has promised to continue keeping a close watch on the market.

As part of the 2017-2018 report issued by the SFC, the authority noted that crypto and blockchain-related technologies and investment instruments do, in fact, come with risks. Because of this, it has promised to ‘intervene when appropriate’.

Fortunately, the annual report doesn’t focus on the risks alone. In fact, it also outlines the supportive actions undertaken by the regulatory authority to promote a safe and stable market. For instance, it announces the launch of the sandbox program, which allows registered firms to test and carry out regulated activities, via new financial technologies.

Additionally, the SFC has also highlighted their partnership with the Investor Education Centre, which plans to release several educational materials for the crypto market. However, future plans indicate that several public campaigns concerning the risks associated with digital currencies and ICOs will be organized.

The SFC’s first public involvement in digital currencies and ICOs took place in September 2017, when they released their first statement. Shortly after, the FSC published a list of regulatory requirements that digital currency businesses need to follow, and later took action against several crypto-firms for failing to respect the guidelines.

Another aspect worth taking into consideration is that back in May 2018, a HK government report stated that digital currencies like Bitcoin are not directly involved in illegal activities, such as money laundering or illegal financing. This is an important aspect that several worldwide legislative bodies fail to understand – while bitcoin can indeed be used for illegal activities, so can all other cryptocurrencies, alongside cash, which happens to be untraceable.

Based on everything that has been outlined so far, it seems like the Hong Kong SFC is keeping a close eye on cryptocurrencies, yet is giving the market enough space for healthy development.