Hong Kong Securities Commission to Draft Regulatory Requirements
The Hong Kong Securities Regulatory Commission has said that it is currently making rules for registered virtual asset exchanges in line with the new framework and will soon start asking the public for feedback on the matter. This will take place very soon. A slew of disappointing reports rocked the currency market. In response to questions from the media about the cryptocurrency exchange FTX filing for bankruptcy, the Securities Regulatory Commission said that the event affected other virtual tokens and the industry as a whole. This showed that retail investors use trading platforms for virtual assets that are not fully regulated. They will keep an eye on how the risks are changing and how important it is to figure out if the regulatory structure is good enough to protect investors.
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SFC Will Undertake Public Consultations and Monitor Virtual Asset Developments
After the Legislative Council passed the “Anti-Money Laundering and Terrorist Financing (Amendment) Bill,” the Securities and Futures Commission said that it is currently drafting rules for licensed virtual asset exchanges that will be used in the new system. The Securities and Futures Commission will also hold public consultations and keep a close eye on the latest developments in the field of virtual assets. Their main goal is to protect investors, which is why they are doing these things.
The Hong Kong Securities and Futures Commission (SFC) reaffirmed that, even though many jurisdictions have adopted looser standards for regulating encrypted asset service providers from the perspective of anti-money laundering or payment, Hong Kong had adopted comprehensive supervision in response to the operation of relevant exchanges similar to securities brokers. This was said replying to the fact that Hong Kong has put in place strict rules about how exchanges work.
The Exchange Will Keep Clients Funds Separate and Provide Audited Records
As part of this strict oversight, the exchange must ensure that client funds are kept separate and regularly show audited accounts and financial information. In addition, this requirement ensures that the exchange is appropriately monitored. It has been asserted that the FTX event has repercussions not only for FTX but also for other tokens and the whole business. This shows the risks that retail investors face when they use trading platforms that are not fully regulated. It also shows how important it is to determine if the regulatory framework can protect investors.
