Hong Kong ends license application drive for crypto exchanges

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All crypto exchanges and trading platforms that have failed to file for license applications with the regulator by Feb. 29 must wind up their business in Hong Kong by May 31.

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Hong Kong ends license application drive for crypto exchanges

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Hong Kong has stopped accepting license applications from crypto exchanges as of Feb. 29 and will soon require all noncompliant trading platforms to close their business locally.

The Securities and Futures Commission (SFC) of Hong Kong noted that all crypto exchanges in Hong Kong that have failed to file for license applications must wind up business by May 31, 2024.

Notice issued by the Hong Kong SFC about the closure of crypto license applications. Source: sfc.hk

The Hong Kong SFC also urged investors using virtual asset trading platforms to “make preparations early” and migrate to one of the players that have either already received operating licenses or have applied for one.

The SFC formally licensed two crypto trading operators in Hong Kong: OSL Digital Securities on Dec. 15, 2020, and HashKey Exchange on Nov. 9, 2022. The regulator received license applications from 22 crypto trading platforms, including four exchanges that had applied under the SFC’s previous opt-in regime for crypto trading platforms.

List of all crypto exchanges and trading platforms that applied for operation licenses in Hong Kong. Source: sfc.hk

In addition, four other exchanges — Huobi HK, Meex, BitHarbour and Ammbr — had applied for the license but later either withdrew or had their applications returned. The SFC will also publicly maintain a list of crypto platforms that eventually will be required to close down by law, which aims to inform citizens about the associated risks.

During the close-down period, Hong Kong will limit the exchange’s operational capability and enforce the closure of all marketing activities in the region. The Hong Kong SFC will also release a list of crypto exchanges deemed to be licensed as of June 1, 2024. However, it will not guarantee a license procurement for all the names mentioned.

Related: Hong Kong SFC issues warning over imposter crypto exchange posing as MEXC

Once licensed by the Hong Kong SFC, the crypto exchanges can onboard retail investors to trade Bitcoin (BTC) and Ether (ETH). Various altcoins and stablecoins are currently under review by the SFC for trading approval.

Hong Kong-based crypto exchange BitForex, went incommunicado recently after suspending withdrawals for at least three days.

Blockchain investigator ZachXBT alerted about a suspicious activity on BitForex. Source: X 

The exchange’s X account hasn’t been updated since May 2023. On its official Telegram channel, BitForex users are reporting problems with their accounts, varying from the inability to enter their accounts to the dashboard not showing any assets. Several users shared a pop-up screen showing they are blocked from accessing the company’s website. Cointelegraph’s internal investigation reproduced the same issue.

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