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16 October 2018 at 15:04 BST

Crypto Regulation in Hong Kong on the horizon, says exiting regulator

Exiting Securities regulator's chairman says Hong Kong on verge of proposing crypto regulation, following 'close watch' announced in July.

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Hong Kong’s security watchdog is set to propose crypto regulation, according to Hong Kong’s securities and futures commission (SFC) chairman Carlson Tong Ka-shing

No total ban

The SFC is planning to introduce crypto regulation to protect investors. In July, the SFC declared in its annual report that it is keeping ‘a close watch’ on crypto and ICOs and will intervene as appropriate. Mr Tong, who has passed the baton over to Tim Lui Tim-leung, said the watchdog is not considering a ban on cryptocurrency platforms as the Chinese mainland has done. Mr Tong explained, a total ban is ‘necessarily the right approach,’ adding it will not work in today’s internet world when trading can cross national boundaries. Even if we were to ban them, transactions can still be easily conducted via platforms in overseas markets.’

Legal framework

He stated a legal framework to regulate crypto exchanges is absolutely necessary, noting that the SFC is going to consider the approach carefully as such platforms are ‘new technologies’ and thus cannot treated as securities. Mr Tong's six-year tenture saw the former head of KPMG in mainland China casting the regulatory spotlight firmly on corporate fraud, insider dealing, poor new listings and other white collar crime. He told Soouth China Morning Post his main achievements has been cracking down on so-called 'con stocks,' doling out nearly HK$4 billion (US$510 million) in fines, and awarding compensation worth millions of dollars to hard-done-by investors.

 
   
 
 
 

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