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Hong Kong tightens requirements for crypto dealers and custodial services
According to the regulators’ proposal, broker-dealers are required to obtain a license to provide services for trading crypto assets. The license also applies to over-the-counter cryptocurrency operations. The need to obtain permission will equate crypto dealers with traditional brokers, who are required to comply with securities laws.
Custodial services will also have to obtain a special license, as they are responsible for safeguarding client assets, the regulators insist. Platforms must separate their own assets from client funds and ensure the secure operation of systems, reducing the risk of financial losses or hacks.
The authorities stated that the development of the relevant legislation will begin soon. The new rules will supplement the existing licensing system for virtual asset trading platforms, whose activities are already overseen by the SFC. The Commission now intends to expand its oversight to cryptocurrency dealers and custodians.
Recently, Hong Kong authorities announced plans to allow insurance companies to invest in crypto assets. In June, the Hong Kong Monetary Authority (HKMA) clarified requirements for stablecoin issuers.
See also: "China to restrict silver exports due to a shortage of the precious metal"
