In a move
to bolster retail investors' protection, Hong Kong's Securities and Futures
Commission (SFC) has announced a series of new measures this week. These
initiatives come on the heels of the JPEX crypto exchange debacle, which
exposed vulnerabilities in the city's regulatory framework for virtual assets.
The SFC's new measures aim to enhance transparency, improve public awareness,
and tighten regulations around crypto trading platforms.
JPEX Blowup Prompted
Response from Hong Kong Regulator
In June
2023, Hong Kong opened up to retail cryptocurrency trading, significantly
relaxing the country's existing rules. However, the number of licensed
platforms that could provide these services remains small, a fact exploited by
other, unregulated entities to attract new customers. One such exchange
Exchange
An exchange is known as a marketplace that supports the trading of derivatives, commodities, securities, and other financial instruments.Generally, an exchange is accessible through a digital platform or sometimes at a tangible address where investors organize to perform trading. Among the chief responsibilities of an exchange would be to uphold honest and fair-trading practices. These are instrumental in making sure that the distribution of supported security rates on that exchange are effectiv
An exchange is known as a marketplace that supports the trading of derivatives, commodities, securities, and other financial instruments.Generally, an exchange is accessible through a digital platform or sometimes at a tangible address where investors organize to perform trading. Among the chief responsibilities of an exchange would be to uphold honest and fair-trading practices. These are instrumental in making sure that the distribution of supported security rates on that exchange are effectiv
Read this Term was
JPEX, which is now facing serious issues with the withdrawal of investor funds.
To combat
the disinformation, the SFC plans to publish a comprehensive list of licensed Virtual
Asset Trading Platforms (VATPs) on its website. This list will include currently
licensed platforms, those in the application process, and entities that have
been ordered to shut down or are deemed suspicious. The regulator believes this
transparent approach will help investors decide which platforms to engage with.
📰Hong Kong to Reveal Crypto License Applicants Post-JPEX Investigation
In response to public demand and following the JPEX probe, Hong Kong’s Securities and Futures Commission (SFC) will disclose a list of all crypto exchange license applicants.
This move aims to highlight… pic.twitter.com/nwo215N81v
— SourceFeed (@SourceFeed_) September 25, 2023
In addition
to enhancing transparency, the SFC is launching a public campaign to educate
people on protecting themselves against fraud. The commission is committed
to investigating and prosecuting illegal platforms. To this end, the SFC is
ramping up its intelligence-gathering efforts on businesses related to virtual
assets.
"The
SFC will, within its statutory powers, continue to strengthen its intelligence
gathering process towards different businesses related to virtual assets. It
will continue to take follow-up and enforcement actions against suspicious
VATPs that may have violated the law, and refer cases to the Police when
necessary," the SFC commented
in the official press release.
The
planned actions presented by SFC were summarized in the table below:
Action | Description |
Publication
of VATP Lists | The SFC will publish various lists
to disseminate information transparently and timely. These lists include: List
of licensed VATPs, list of closing-down VATPs, list of deemed licensed VATPs
as of 1 June 2024 and List of VATP applicants due to public demand. |
Enhanced List of Suspicious VATPs | The SFC will issue a dedicated
list of suspicious VATPs that will be easily accessible on its website. The
aim is to help the public identify potentially fraudulent VATPs and disseminate
information clearly, transparently, and timely. |
Public Awareness
Campaign | The SFC and the IFEC will launch a
campaign to raise public awareness against fraud. This will be done through
various means such as mass media, social media, and educational talks, aiming
to enhance understanding of the risks associated with Virtual Assets (VAs)
and potential fraud. |
Strengthening
Intelligence Gathering | The SFC will continue to
strengthen its intelligence-gathering process regarding businesses related to
VAs. It will take follow-up and enforcement actions against suspicious VATPs
and refer cases to the Police when necessary. The public is encouraged to
file complaints via the SFC's Online Complaint Form. |
Update on JPEX Case
Over the
weekend, 11 individuals connected to the JPEX case were arrested, and
authorities are seeking Interpol assistance to apprehend the exchange's
leaders. Some cryptocurrencies
Cryptocurrencies
By using cryptography, virtual currencies, known as cryptocurrencies, are nearly counterfeit-proof digital currencies that are built on blockchain technology. Comprised of decentralized networks, blockchain technology is not overseen by a central authority.Therefore, cryptocurrencies function in a decentralized nature which theoretically makes them immune to government interference. The term, cryptocurrency derives from the origin of the encryption techniques that are employed to secure the netw
By using cryptography, virtual currencies, known as cryptocurrencies, are nearly counterfeit-proof digital currencies that are built on blockchain technology. Comprised of decentralized networks, blockchain technology is not overseen by a central authority.Therefore, cryptocurrencies function in a decentralized nature which theoretically makes them immune to government interference. The term, cryptocurrency derives from the origin of the encryption techniques that are employed to secure the netw
Read this Term linked to the fraud have also been frozen. More
than 1,400 complaints have been filed against the trading platform, indicating
losses exceeding HKD 1 billion, or approximately $127.9 million.
Additionally,
Finance Magnates disclosed last Monday that local authorities detained
financial influencer Joseph Lam Chok due to his online promotion of the
troubled exchange. The arrest occurred just a few hours following the
exchange's latest issues.
Hong Kong's Social Media Sensation, Joseph Lam, Arrested in Daring HK$34 Million JPEX Crypto Scandal! pic.twitter.com/zSUlXRZRTM
— Crypto University (@TheCryptoU) September 18, 2023
The SFC
stated that it would continue to review the regulatory landscape in Hong Kong
and take timely measures in response to new market developments.
"Adhering
to the 'same business, same risks, same rules' principle, the SFC will work
with the HKSAR Government to regularly review the regulatory regime in Hong
Kong and consider timely measures in light of new market developments. These
measures may include regulation of VA-related businesses other than the VATPs,"
the regulator added.
The SFC has
been proactive in identifying the potential benefits and risks associated with
digital finance and virtual asset activities. Under the Anti-Money Laundering
and Counter-Terrorist Financing Ordinance, which came into full effect on 1
June 2023, the SFC has closed gaps in its licensing and supervision powers over
VATPs. The regulator has imposed stringent requirements to ensure investor
protection, including enhanced due diligence and robust governance measures.
In a move
to bolster retail investors' protection, Hong Kong's Securities and Futures
Commission (SFC) has announced a series of new measures this week. These
initiatives come on the heels of the JPEX crypto exchange debacle, which
exposed vulnerabilities in the city's regulatory framework for virtual assets.
The SFC's new measures aim to enhance transparency, improve public awareness,
and tighten regulations around crypto trading platforms.
JPEX Blowup Prompted
Response from Hong Kong Regulator
In June
2023, Hong Kong opened up to retail cryptocurrency trading, significantly
relaxing the country's existing rules. However, the number of licensed
platforms that could provide these services remains small, a fact exploited by
other, unregulated entities to attract new customers. One such exchange
Exchange
An exchange is known as a marketplace that supports the trading of derivatives, commodities, securities, and other financial instruments.Generally, an exchange is accessible through a digital platform or sometimes at a tangible address where investors organize to perform trading. Among the chief responsibilities of an exchange would be to uphold honest and fair-trading practices. These are instrumental in making sure that the distribution of supported security rates on that exchange are effectiv
An exchange is known as a marketplace that supports the trading of derivatives, commodities, securities, and other financial instruments.Generally, an exchange is accessible through a digital platform or sometimes at a tangible address where investors organize to perform trading. Among the chief responsibilities of an exchange would be to uphold honest and fair-trading practices. These are instrumental in making sure that the distribution of supported security rates on that exchange are effectiv
Read this Term was
JPEX, which is now facing serious issues with the withdrawal of investor funds.
To combat
the disinformation, the SFC plans to publish a comprehensive list of licensed Virtual
Asset Trading Platforms (VATPs) on its website. This list will include currently
licensed platforms, those in the application process, and entities that have
been ordered to shut down or are deemed suspicious. The regulator believes this
transparent approach will help investors decide which platforms to engage with.
📰Hong Kong to Reveal Crypto License Applicants Post-JPEX Investigation
In response to public demand and following the JPEX probe, Hong Kong’s Securities and Futures Commission (SFC) will disclose a list of all crypto exchange license applicants.
This move aims to highlight… pic.twitter.com/nwo215N81v
— SourceFeed (@SourceFeed_) September 25, 2023
In addition
to enhancing transparency, the SFC is launching a public campaign to educate
people on protecting themselves against fraud. The commission is committed
to investigating and prosecuting illegal platforms. To this end, the SFC is
ramping up its intelligence-gathering efforts on businesses related to virtual
assets.
"The
SFC will, within its statutory powers, continue to strengthen its intelligence
gathering process towards different businesses related to virtual assets. It
will continue to take follow-up and enforcement actions against suspicious
VATPs that may have violated the law, and refer cases to the Police when
necessary," the SFC commented
in the official press release.
The
planned actions presented by SFC were summarized in the table below:
Action | Description |
Publication
of VATP Lists | The SFC will publish various lists
to disseminate information transparently and timely. These lists include: List
of licensed VATPs, list of closing-down VATPs, list of deemed licensed VATPs
as of 1 June 2024 and List of VATP applicants due to public demand. |
Enhanced List of Suspicious VATPs | The SFC will issue a dedicated
list of suspicious VATPs that will be easily accessible on its website. The
aim is to help the public identify potentially fraudulent VATPs and disseminate
information clearly, transparently, and timely. |
Public Awareness
Campaign | The SFC and the IFEC will launch a
campaign to raise public awareness against fraud. This will be done through
various means such as mass media, social media, and educational talks, aiming
to enhance understanding of the risks associated with Virtual Assets (VAs)
and potential fraud. |
Strengthening
Intelligence Gathering | The SFC will continue to
strengthen its intelligence-gathering process regarding businesses related to
VAs. It will take follow-up and enforcement actions against suspicious VATPs
and refer cases to the Police when necessary. The public is encouraged to
file complaints via the SFC's Online Complaint Form. |
Update on JPEX Case
Over the
weekend, 11 individuals connected to the JPEX case were arrested, and
authorities are seeking Interpol assistance to apprehend the exchange's
leaders. Some cryptocurrencies
Cryptocurrencies
By using cryptography, virtual currencies, known as cryptocurrencies, are nearly counterfeit-proof digital currencies that are built on blockchain technology. Comprised of decentralized networks, blockchain technology is not overseen by a central authority.Therefore, cryptocurrencies function in a decentralized nature which theoretically makes them immune to government interference. The term, cryptocurrency derives from the origin of the encryption techniques that are employed to secure the netw
By using cryptography, virtual currencies, known as cryptocurrencies, are nearly counterfeit-proof digital currencies that are built on blockchain technology. Comprised of decentralized networks, blockchain technology is not overseen by a central authority.Therefore, cryptocurrencies function in a decentralized nature which theoretically makes them immune to government interference. The term, cryptocurrency derives from the origin of the encryption techniques that are employed to secure the netw
Read this Term linked to the fraud have also been frozen. More
than 1,400 complaints have been filed against the trading platform, indicating
losses exceeding HKD 1 billion, or approximately $127.9 million.
Additionally,
Finance Magnates disclosed last Monday that local authorities detained
financial influencer Joseph Lam Chok due to his online promotion of the
troubled exchange. The arrest occurred just a few hours following the
exchange's latest issues.
Hong Kong's Social Media Sensation, Joseph Lam, Arrested in Daring HK$34 Million JPEX Crypto Scandal! pic.twitter.com/zSUlXRZRTM
— Crypto University (@TheCryptoU) September 18, 2023
The SFC
stated that it would continue to review the regulatory landscape in Hong Kong
and take timely measures in response to new market developments.
"Adhering
to the 'same business, same risks, same rules' principle, the SFC will work
with the HKSAR Government to regularly review the regulatory regime in Hong
Kong and consider timely measures in light of new market developments. These
measures may include regulation of VA-related businesses other than the VATPs,"
the regulator added.
The SFC has
been proactive in identifying the potential benefits and risks associated with
digital finance and virtual asset activities. Under the Anti-Money Laundering
and Counter-Terrorist Financing Ordinance, which came into full effect on 1
June 2023, the SFC has closed gaps in its licensing and supervision powers over
VATPs. The regulator has imposed stringent requirements to ensure investor
protection, including enhanced due diligence and robust governance measures.