Hong Kong gives conditional licenses to four crypto exchanges

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As a seasoned crypto investor with roots in the dynamic city of Hong Kong, I find the recent news about the SFC granting licenses to four new virtual asset trading platforms nothing short of refreshing. With seven licensed exchanges now operating in the city, it seems like the “Land of the Free” is becoming the “Land of the Freely Traded Cryptos.

The Hong Kong Securities and Futures Commission (SFC) has given preliminary approval for operation to four cryptocurrency exchange platforms, subject to certain conditions.

According to the SFC, these platforms – Accumulus GBA Technology, DFX Labs, Hong Kong Digital Asset Exchange, and Thousand Whales Technology – need to comply with certain regulatory standards before they can fully commence their operations.

The licensing procedures align with the SFC’s risk-based inspections, which were implemented in June. These inspections serve to assess conformity with Hong Kong’s virtual asset rules, with a focus on safeguarding investors and promoting development within the cryptocurrency industry.

In order to continue, it’s necessary for authorized trading platforms to undergo external evaluations focusing on vulnerabilities and penetration testing. These evaluations help in discovering and resolving any potential security flaws, thereby guaranteeing that these systems are robust enough to safely manage digital asset transactions.

The Security and Fire Code (SFC) will monitor the situation and evaluate if the platforms have effectively addressed problems discovered during inspections.

The Securities and Futures Commission (SFC) in Hong Kong has given its seal of approval to four new cryptocurrency platforms. These are:

— StellDex™ (@StellDex_HQ) December 18, 2024

SFC’s inspections and expecations

As reported by Dr. Eric Yip, the SFC’s Intermediaries’ Executive Director, the regulatory body has collaborated extensively with the leadership of these platforms to set clearer expectations and expedite the licensing procedure.

During the next stage of evaluations, external examiners will appraise the platforms overseen by the SFC. Once this phase is successfully finished, meeting all necessary criteria, these exchanges can broaden their business activities.

Additionally, the Securities and Futures Commission (SFC) has provided a detailed plan for obtaining licenses, which is designed to make the process of becoming compliant easier for digital asset trading platforms, all while maintaining strict regulatory requirements.

For individuals new to the world of cryptocurrency regulations, licenses such as these guarantee that trading platforms function within the law and maintain a secure environment. Platforms with these licenses are required to put in place protective measures for users’ funds, block fraudulent activities, and discourage market manipulation.

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2024-12-18 19:08