The Securities and Futures Commission (SFC) in Hong Kong is currently reviewing regulations surrounding virtual currency transactions, including whether people can invest in exchange-traded funds (ETFs).
Based on a report by South China Morning News on November 3, 2021, the 2018 regulations limited the transactions of cryptos through funds or trading platforms to professional investors with more than HK$8 million ($1,028,624.00) to invest.
So far, the Securities and Futures Commission of Hong Kong has already received many requests to approve cryptocurrency ETFs for trading. Julia Leung Fung-yee, SFC’s deputy chief executive, said that the re-evaluation will be made “to see if it is still fit for purpose and whether modifications are required.”
While speaking at the 2021 Hong Kong Financial Technology Week conference, Fung-yee said:
Buy Crypto Now
“Virtual assets are edging toward traditional finance, hence, the need to review the laws. More, [and] different types of virtual asset investment products are available and conventional exchanges overseas now offer cryptocurrency ETFs.”
Hong Kong Regulates Crypto Operations
Currently, crypto ETFs are not available in Hong Kong. Although the available financial instruments are not available, they can be acquired from other countries. In the US, nearly 12 applications for these exchange-traded funds have been submitted to the SEC by companies aiming to offer speculators an opportunity to dive into the crypto world.
Multiple inquiries have been submitted to the Hong Kong watchdog by firms wishing to offer such investments. Since the SFC created these regulations about three years ago, digital assets have now grown extensively in popularity.
Bitcoin has gained six-fold to trade above $62,000 this week. The latest rally was powered by big investors and funds rushing into the crypto scene on the belief that they might soon be used as payments while the retail investors joined the bandwagon for quick profits.
The SFC is working with the de facto central bank called the Hong Kong Monetary Authority (HKMA) to create a unified circular after the evaluation. Based on the statement by Fung-yee, the HKMA and SFC are set to apply the principle of “same business, same risks and same rules” for all the banks, brokers, and digital platforms offering any digital currency asset-related services.