{"id":72385,"date":"2024-02-27T04:06:16","date_gmt":"2024-02-27T08:06:16","guid":{"rendered":"https:\/\/coinscreed.com\/staging\/?p=72385"},"modified":"2024-02-27T04:06:19","modified_gmt":"2024-02-27T08:06:19","slug":"hong-kong-plans-tighter-regulations-for-otc-crypto-services","status":"publish","type":"post","link":"https:\/\/coinscreed.com\/staging\/hong-kong-plans-tighter-regulations-for-otc-crypto-services\/","title":{"rendered":"Hong Kong Plans Tighter Regulations For OTC Crypto Services"},"content":{"rendered":"\n

To prevent fraud and money laundering, Hong Kong intends to impose stringent regulations on over-the-counter crypto service providers.<\/a><\/p>\n\n\n\n

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Hong Kong Plans Tighter Regulations For OTC Crypto Services<\/figcaption><\/figure>\n\n\n\n

As Hong Kong advances toward its goal of becoming the crypto center of Asia, regulators are acting swiftly to thwart any suspicious over-the-counter (OTC) crypto trading activities.<\/p>\n\n\n\n

Cryptocurrency Shops in Hong Kong Face Closure Due to Crackdown<\/h2>\n\n\n\n

According to official estimates, an estimated 450 establishments, including ATMs, stores, and online platforms, provide these services in Hong Kong. <\/p>\n\n\n\n

According to Chainalysis data,\r\n \r\n \r\n \r\n <\/g>\r\n \r\n \r\n \r\n <\/clipPath>\r\n <\/defs><\/svg><\/span><\/a> these establishments have a substantial impact on facilitating over-the-counter (OTC) cryptocurrency transactions, which accounted for a considerable proportion of the $64 billion in digital asset transactions that passed through the city in the year ending June.<\/p>\n\n\n\n

Concerns have been raised regarding the possible complicity of certain cryptocurrency retailers in unlawful operations. This includes facilitating fraudulent schemes that target investors and assisting Chinese nationals in circumventing restrictions on international transfers.<\/p>\n\n\n\n

Hong Kong authorities are constructing a licensing framework under the purview of the customs department. By requiring crypto over-the-counter (OTC) providers to adopt customer record-keeping procedures and augment staffing levels for improved governance, this framework will indicate an impending rise in operational expenditures.<\/p>\n\n\n\n

In addition, Hong Kong endeavors to cultivate a group of stringently regulated cryptocurrency exchanges as a feasible substitute for the over-the-counter (OTC) market in terms of obtaining digital assets. <\/p>\n\n\n\n

The deadline for these exchanges to secure or file for a permit by regulations implemented by the Securities and Futures Commission in mid-2023 is February 29.<\/p>\n\n\n\n

OTC Market Regulation Reform for Cryptocurrencies<\/h3>\n\n\n\n

With the objective of strengthening regulatory supervision and countering illicit activities, Hong Kong intends to enforce rigorous regulations on providers of over-the-counter (OTC) cryptocurrency services. <\/p>\n\n\n\n

Chengyi Ong, the APAC policy director at Chainalysis, opined that the proposed framework might facilitate the sector's operations, thereby diminishing its utility as entry points into the cryptosphere. <\/p>\n\n\n\n

Ong underscored the imperative for service providers to bolster their risk management protocols, specifically in addressing cybersecurity threats and financial offenses.<\/p>\n\n\n\n

The Treasury Bureau of Hong Kong and Financial Services has launched a consultation period scheduled to conclude on April 12 to collect input regarding the proposed over-the-counter (OTC) regulations. <\/p>\n\n\n\n

The principal goals of the regulatory reform encompass the prevention of terrorism financing, the curtailment of money laundering, and the deterrence of fraudulent activities. <\/p>\n\n\n\n

It is worth mentioning that service providers who are already subjected to stringent supervision by regulatory bodies like the Securities & Futures Commission (SFC) <\/use><\/svg><\/span><\/a>or the Hong Kong Monetary Authority will be exempt from these provisions.<\/p>\n\n\n\n

A Financial Services and the Treasury Bureau representative stated, citing the agency's extensive experience in regulatory enforcement, that the customs division is well-suited to supervise crypto OTC service providers. <\/p>\n\n\n\n

According to the spokesperson, the proposed rulebook is intended to implement vital safeguards and ensure the utmost protection of investors.<\/p>\n\n\n\n

One Satoshi, a notable over-the-counter (OTC) participant in Hong Kong, manages an extensive retail location network that streames cryptocurrency transactions. <\/p>\n\n\n\n

According to Roger Li, co-founder of One Satoshi, the organization complies with anti-money laundering and know-your-customer protocols. <\/p>\n\n\n\n

However, he opined that the imminent regulatory obligations concerning record-keeping and compliance personnel might increase operational expenses. <\/p>\n\n\n\n

Li conveyed a sense of ambiguity concerning the ramifications for over-the-counter (OTC) companies, suggesting they might suspend their cryptocurrency activities or pursue certification under the novel regulatory framework pending additional instructions.<\/p>\n","protected":false},"excerpt":{"rendered":"

To prevent fraud and money laundering, Hong Kong intends to impose stringent regulations on over-the-counter crypto service providers. As Hong Kong advances toward its goal of becoming the crypto center of Asia, regulators are acting swiftly to thwart any suspicious over-the-counter (OTC) crypto trading activities. Cryptocurrency Shops in Hong Kong Face Closure Due to Crackdown […]<\/p>\n","protected":false},"author":53,"featured_media":72387,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[32],"tags":[5667,6251,18584],"class_list":["post-72385","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-crypto-exchange-news","tag-cryptocurencies","tag-hong-kong-2","tag-hong-kong-sfc-2"],"jetpack_featured_media_url":"https:\/\/coinscreed.com\/staging\/wp-content\/uploads\/2024\/02\/CT-4.jpg","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/posts\/72385","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/users\/53"}],"replies":[{"embeddable":true,"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/comments?post=72385"}],"version-history":[{"count":0,"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/posts\/72385\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/media\/72387"}],"wp:attachment":[{"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/media?parent=72385"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/categories?post=72385"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/tags?post=72385"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}