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In a major move to establish itself as a crypto hub, Hong Kong plans to allow retail investors to trade certain digital currencies on licensed exchanges. This move contradict China’s stance on crypto related transactions which are outright banned and U.S. crack down on crypto industry.
While there was no mention as to which large-cap tokens would be allowed, Securities and Futures Commission (SFC) spokesperson said they would likely be Bitcoin and Ether, two of the biggest digital assets by market value.
Hong Kong securities and futures markets regulator announced safeguards like knowledge tests, risk profiles and reasonable limits on exposure.
SFC also announced that the consultation period ends on Mar.31 and target is to allow retail trading from June 1.
Currently, the city’s framework for crypto exchanges is a voluntary one that restricts them to clients with portfolios of at least HK$8M.
In late October 2022, Hong Kong had taken its steps towards legalizing retail-investor crypto trading.
Hong Kong government has already allowed ETFs investing in CME Group (CME) Bitcoin and Ether futures and also sold inaugural digital green bonds starting February.
In mid-February, Interactive Brokers (IBKR) launched cryptocurrency trading in Hong Kong in collaboration with OSL Digital Securities.
Performance on YTD basis:
Related Read: In the past-week, bitcoin ended the week ~14% higher in comparison to broader equity markets which saw a lower sentiment led by concerns over the future of the Federal Reserve’s rate hikes.
As per CoinMarketCap data, the two largest tokens (Bitcoin and Ether) by market cap both contributed to a 7.1% climb in the total value of the crypto market, standing at $1.12T at the time of writing.
In 2023, Crypto related ETFs have seen a significant surge leading the top 10 YTD percentage gainers among non-leveraged ETFs.
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