The Hong Kong regulator is re-examining cryptocurrency ETF laws for retail clients

Hong Kong’s Securities and Futures Commission (SFC) is reviewing rules for virtual currency transactions, including whether people can invest in exchange-traded funds or ETFs.

According to a report in the South China Morning News on Wednesday, The 2018 regulations restricted cryptocurrency transactions through funds or trading platforms to professional investors with an investment of HK $ 8 million or more (US $ 1,028,624.00).

SFC Deputy Executive Director Julia Leung Fung-yee said the reassessment will be carried out “to see if it is still fit for purpose and if changes are needed”. Fung-yee said at the Hong Kong Financial Technology Week 2021 conference that “virtual assets are approaching traditional finance,” hence the need to review the laws.

“There are more [y] Various types of virtual investment products are available and conventional overseas exchanges are now offering cryptocurrency ETFs.

The Hong Kong regulator is re-examining cryptocurrency ETF laws for retail clients
The Hong Kong regulator is re-examining cryptocurrency ETF laws for retail clients

Cryptocurrency ETFs are not available to Hong Kong-based investors, although these financial instruments can be purchased in other countries. In the United States, at least 12 applications for these funds have been filed with the SEC by companies seeking to give speculators the opportunity to get involved in cryptocurrencies. Several inquiries have been made to the Hong Kong regulator by companies looking to make such investments.

Since the SFC put these regulations in place three years ago, digital assets have grown in popularity tremendously, with Bitcoin (BTC) up six times this week to $ 62,238.. The rally was fueled by large investors and funds rushing to invest in cryptocurrencies, convinced they would soon be used for payments, while retail investors joined the party for quick profits.

The SFC is working with the de facto central bank, the Hong Kong Monetary Authority (HKMA), to produce a unified circular following the valuation. According to Fung-yee, SFC and HKMA will apply the “same business, same risks and same rules” principle to banks, brokers and digital platforms that conduct activities related to digital currency investments.

Similar Posts