Hong Kong’s Securities and Futures Fee (SFC) not too long ago introduced that it’ll conduct on-site workplace inspections of cryptocurrency platforms looking for licenses. The regulator harassed that 18 “deemed licensed” candidates should bear scrutiny earlier than their functions are permitted.
Securities Regulatory Fee proclaims cryptocurrency inspection
On Tuesday, the Securities and Futures Fee revealed that it’ll look at platforms making use of to turn into a licensed digital asset buying and selling platform (VATP) in Hong Kong. Exams shall be administered over the following few months and VATP candidates deemed licensed within the meantime will proceed to use.
The on-site inspection will concentrate on the cryptocurrency platform’s safety of buyer property and know-your-customer (KYC) processes to find out whether or not the corporate complies with the SEC’s regulatory necessities.
Excerpt of the SFC’s announcement. Supply: SFC
The outcomes of the inspection “shall be factored into the license software course of,” which requires VATP and its house owners to adjust to all relevant legal guidelines and laws. In keeping with the announcement, any breach or non-compliance with key regulatory necessities will outcome within the license being refused.
Moreover, if investor safety provisions aren’t met throughout an inspection, the SEC might take extra regulatory motion towards cryptocurrency platforms if deemed essential.
The regulator additionally reminds candidates that they have to adjust to all regulatory necessities and licensing circumstances of the Securities and Futures Fee in the course of the software course of. These circumstances embody stopping residents of mainland China from accessing the platform’s digital asset-related companies, advertising its companies or attracting retail customers.
The SFC doesn’t count on these candidates to actively market their companies or entice new retail prospects earlier than they’ve demonstrated to the SFC’s satisfaction the precise implementation and effectiveness of their insurance policies, procedures, methods and controls and obtained a proper license.
Non-violation interval ends this week
The China Securities Regulatory Fee identified within the announcement that the important deadline is approaching. Hong Kong regulators reminded cryptocurrency platforms that the non-violation interval for VATPs working within the jurisdiction will finish on June 1, 2024.
In keeping with Bitcoinist experiences, the Securities and Futures Fee issued new regulatory tips requiring all VATPs working in Hong Kong to submit license functions earlier than February 29. Financing Ordinance (AMLO).
Nonetheless, by June 1, all remaining VATPs within the area should get hold of VATP candidates who’re licensed or “deemed licensed” underneath AMLO. Corporations that proceed to function past the required interval will face authorized motion:
Working a VATP in Hong Kong in violation of the Anti-Cash Laundering Ordinance is a prison offense and the SFC will take all applicable actions towards any unlawful conduct.
Because the non-violation interval involves an finish, Hong Kong regulators are urging traders within the area to solely commerce digital property on platforms licensed by the Securities and Futures Fee. As well as, Hong Kong traders are reminded that though VATP candidates have taken steps to adjust to SFC laws, they haven’t been formally licensed.
As of this writing, HashKey Trade and OSL Trade are the one licensed VATPs working within the area. The opposite 18 VATPs are awaiting a call from the Securities and Futures Fee on their license functions.
Complete crypto market capitalization is at $2.5 trillion within the three-day chart. Supply: TOTAL on TradingView
Featured picture from Unsplash.com, chart from TradingView.com
