Hong Kong Regulator Cracks Whip on Seven Unlicensed Crypto Exchanges
The financial authorities in Hong Kong are set to soon release the results of the stablecoin consultation report as part of the region’s legislative proposal to oversee the industry.
Hong Kong’s topmost financial regulator, the Securities and Futures Commission (SFC), has issued an alert against seven crypto trading platforms for operating in the region illegally without securing the proper licenses. The Hong Kong SFC maintains the public records of all the registered or unregistered crypto exchanges in order to reduce the overall risk related to fraud and scams. In its alert List, the SFC highlights exchanges that are either unlicensed or have false associations with Hong Kong.
Since January 2020, the Hong SFC has maintained the Alert List which currently has 39 entries. In 2024 alone, 28 cryptocurrency exchanges have been flagged for suspicious activities. The latest additions to this list include Taurusemex, Yomaex, Bitones.org, BTEPRO, CEG, XTCQT, and Bstorest.
Warnings indicate that all these exchanges are suspected of fraudulent activities, misleading investors into believing they were registered with the SFC. Many of these exchanges employed extortion tactics, such as blocking withdrawals and demanding “fees” to resume operations.
Since the beginning of this year 2024, Hong Kong regulators have undertaken bold measures to ensure the regulatory compliance of the crypto trading services. The SFC had already asked all exchanges to apply for a license by May 31. Post the deadline, the SFC has asked exchanges to shut down their shops that failed to register.
During this period, over 22 cryptocurrency exchanges applied for licenses to maintain their presence in the region. However, many of them ultimately chose to withdraw their applications just before the deadline.
Hong Kong to Soon Release Stablecoin Consultation Results
The financial authorities in Hong Kong are set to soon release the results of the stablecoin consultation report as part of the region’s legislative proposal to oversee the industry.
In a statement earlier today, the Financial Services and the Treasury Bureau noted that they will publish the results of the December consultation on stablecoin issuers and further submit the draft of the legislative bill to the Legislative Council.
At that time, regulators suggested that all fiat-referenced stablecoin issuers should obtain a license from the Hong Kong Monetary Authority, the de facto central bank that co-released the stablecoin consultation.
In the statement earlier today, the FSTB stated that it suggested only certain entities which include licensed stablecoin issuers, authorized banks, and licensed crypto trading platforms to sell fiat-pegged stablecoin to users.
The proposal also aims to introduce regulations for stablecoin issuers covering reserve management, stability mechanisms, redemption, and governance, according to the statement.
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