As an analyst with extensive experience in the financial and tech industries, I’m closely monitoring the developments surrounding Hong Kong’s aspirations to become a leading hub for Web3 and crypto. The recent withdrawals of top global exchanges like Binance, Huobi, and OKX from Hong Kong’s Securities and Futures Commission (SFC) licensing process have raised concerns about the viability of these ambitions.
It appears that Hong Kong’s aspirations to emerge as the premier location for Web3 and cryptocurrency are being overshadowed, as several leading international exchanges have abandoned their applications for regulatory approval from Hong Kong’s Securities and Futures Commission (SFC).
Global Exchanges Withdraw from Hong Kong
According to recent local news, several prominent international cryptocurrency exchanges, including Binance, Huobi, and OKX, have chosen to withdraw their applications during late May. As a result, the number of applicants has been reduced to eleven.
As an analyst, I’ve come across the Hong Kong SFC’s rule that applicants for virtual asset trading platform licenses must sign a commitment letter, prohibiting them from serving mainland Chinese users in any region. This regulation poses a considerable hurdle for conventional offshore exchanges like OKX. Although OKX attempted to establish an industry alliance to challenge this condition, ultimately, their efforts were unavailing.
Industry experts have pointed out that the former company might consider updating its business structure or legislation before making another application. Yet, they cautioned against using a name reminiscent of offshore trading platforms during this process.
Are HK’s Web3 Ambitions Over?
Many in the crypto community are expressing doubts about Hong Kong’s continued role as a significant player in the Web3 industry following OKX’s departure.
As a researcher studying the implementation of the new system in Hong Kong, I’ve come across concerns from several individuals within local WeChat circles. They believe that the authorities’ cautious approach and adherence to traditional financial thinking have hindered the competitiveness and adaptability of the licenses. This conservatism has reportedly led some operators to abandon their applications, despite significant investments made earlier on.
As a researcher examining Hong Kong’s new licensing system for virtual assets, I came across several points of concern. Initially, the policies and measures concerning the growth of Hong Kong’s virtual asset market—including VATP, stablecoin issuance, and over-the-counter trading—were developed independently by different departments without a unified strategic vision for industrial progress.
The policies for completing the Web3 layout went through the consultation and legislative phases at various points in time. Consequently, the implementation of the entire design has been a gradual process. However, this lengthy procedure has had difficulty staying current with the fast-paced advancements in technology.
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2024-06-02 13:57