Hong Kong's Securities and Futures Commission (SFC) has issued a warning about unlicensed virtual asset trading platforms that are involved in misconduct, signaling the possibility of criminal charges. The SFC's notice, dated August 7, highlights that certain trading fir ms have falsely claimed to have submitted license applications in Hong Kong. If these firms eventually apply for legal operations within the special administrative region but have made false representations, the SFC will consider potential criminal charges.
Several unlicensed cryptocurrency trading platforms in Hong Kong have established new entities, asserting that they have initiated applications with the securities regulator. However, the SFC points out that the services and products offered by some of these new entities might not adhere to legal and regulatory requirements that came into effect on June 1. The SFC emphasizes that established entities must either apply for an SFC license or cease their operations in Hong Kong, stating that conducting unlicensed activities in Hong Kong is a criminal offense.
Certain cryptocurrency companies, such as HashKey and OSL, have secured licenses under the SFC regime, permitting them to offer various cryptocurrency services to Hong Kong residents. The regulatory framework mandates that cryptocurrency exchanges and service providers ensure secure asset custody and comply with regulations related to know-your-customer procedures, anti-money laundering measures, and counter-terrorist financing protocols, among other regulatory provisions.
