The CEO of Hong Kong’s Securities and Futures Commission, Julia Leung Fung Yee spoke on the difficulties that the crypto market has encountered in the last year at an executive dinner in Bangkok hosted by the Hong Kong Economic and Trade Office, the Key Enterprise Office, and InvestHK.
She emphasized that a few cryptocurrency-related firms had defaulted or gone bankrupt, posing risks to the whole sector. She also stated that her country has no plans to develop a cryptocurrency trading center.
The Hong Kong Securities Regulatory Commission’s chief executive, Leung Fung-yee, stated that the objective is not to make Hong Kong a cryptocurrency trading hub, but that crypto trading is an essential aspect of the virtual asset ecosystem.
She also believes that cryptocurrency trading will be a significant part of the global virtual asset ecosystem in 2023.
She further stated that the collapse of FTX has forced even the most permissive jurisdictions to reconsider their approach to cryptocurrency regulation.
The fresh round of cryptocurrency regulatory discussions in Hong Kong began when the SEC sued Binance (BNB), the world’s largest exchange, for illegally offering securities to US residents.
Hong Kong has also invited cryptocurrency exchanges to apply for a license to provide cryptocurrency services in the region.
Julia Leung’s statement seems to go against the Hong Kong Monetary Authority’s (HKMA) viewpoint.
According to Financial Times sources, the HKMA has been more supportive of cryptocurrency enterprises than the SFC and has even “pushed” local banks to work with them.
Local branches of banking titans HSBC and Standard Chartered, for example, were asked to be “more friendly” towards crypto platforms.
She said that the introduction of the new licensing regime in Hong Kong is a clear example of the “one country, two systems” principle in action. It is a win-win for both Hong Kong and China. It allows Hong Kong to capitalize on the growing cryptocurrency market while also respecting China’s regulatory concerns.