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Hong Kong Hopes To Become International Blockchain Hub

Hong Kong Hopes to Become International Blockchain Hub with its Securities and Futures Commission (SFC) declaration in their yearly report that they will keep a close observation on Crypto and Initial Coin Offerings (ICO). According to the watchdog, the new technology comes with risks, which is why they plan to arbitrate when suitable.

Undeniably, the commission has paced in with more explicit regulatory policies this year, intriguing action against local Crypto exchanges, ICOs and counseling the public about potential perils allied to investments in the Crypto market. Hong Kong endures to nurture financial, cross-border schemes powered by Blockchain, steadily gaining repute for being a crucial international Blockchain hub.

A number of ICOs have been launched in Hong Kong, for example, Block One and OpenANX.  It is expected that over the next six months about 10 to 20 companies will issue ICOs in Hong Kong. The legal status of Cryptocurrencies and ICOs in Hong Kong is rather of a grey area.  There is no specific Hong Kong rule or Hong Kong guideline of Cryptocurrencies or ICOs.

Hong Kong’s Securities and Futures Commission (SFC), like other overseas regulators remarkably the US SEC and Singapore’s MAS lately issued an SFC statement on ICOs warning that, in positive conditions, ICOs may compose securities, the proffer of which in Hong Kong would be a matter to Hong Kong securities laws. Hong Kong has not though gone as far as the PRC which has declared ICOs to be alongside the law.

The Future

Selling in or advising on digital tokens considered as securities under the SFO, or managing or marketing a fund endowing in such digital tokens may constitute a synchronized activity. Parties involving in a regulated activity must attain a license from the SFC where their actions target the Hong Kong public, regardless of whether the parties are positioned in Hong Kong said a report in Coin Telegraph.

There is a restricted exception from the condition to be licensed to deal in securities where a person, as principal, deals with a person who is a Type 1 professional investor. This comprises licensed investment intermediaries, endorsed financial institutions, regulated insurance firms, and regulated cooperative investment schemes, government and mutual agencies.

[The views and opinions expressed in this article are those of the authors and do not necessarily reflect the views and/or the official policy of the website. ]

Nagasunder Sharanappa is highly experienced in Content Management and development, Customer Escalation Management ,Payment Operations and Business Process Outsourcing Industry.

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