US SEC Crackdown May Impact Crypto Regulations In Hong Kong: Lawyer

Coingapestaff
June 7, 2023
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Hong Kong licensed lawyer Gilbert NG shed light on the implications of the United States Securities and Exchange Commission’s (SEC) actions on Hong Kong’s regulatory landscape. NG highlighted several key points that underscore the distinct approach taken by the SEC towards cryptocurrency platforms and its potential influence on Hong Kong’s licensing procedures.

More Strict Crypto Regulations In Hong Kong?

SEC’s actions could potentially impact the license application process for Binance and other platforms in the region. NG observes the contrasting treatment of Binance and USDT (Tether) by the SEC. While the SEC has demanded Binance’s complete departure from the United States, this enforcement action may have repercussions for Binance’s operations in other regions, including Hong Kong, where they may be seeking licensing approvals.

Another significant disparity lies in the definition of securities between the United States and Hong Kong. Certain cryptocurrencies may be deemed security tokens in the United States, whereas they may not fall under the same classification in Hong Kong. Currently, Hong Kong restricts the purchase of security tokens to professional investors only, limiting access for retail investors.

Hong Kong has allowed allow crypto firms and exchanges to apply for licenses starting June 1. The administration has also allowed retail investors to trade top cryptocurrencies such as Bitcoin and Ethereum under safeguards of the Hong Kong Securities and Futures Commission.

Read About HK Enabling Retail Investors..

Crypto Regulatory Landscape Differences

United States lacks specific laws and regulations governing cryptocurrencies, leaving a degree of uncertainty in terms of regulatory enforcement. While the United States has taken a stricter stance, characterized by lawsuits, scrutiny and unclear regulatory guidelines, countries like Hong Kong, Japan, and UAE have taken steps to establish clear rules and compliance measures for crypto businesses.

CoinGape reported that Hong Kong is set to receive its first spot Bitcoin ETF, while the US SEC remains reluctant to approve one.

Recently, Binance CEO CZ also welcomed the First Digital USD (FDUSD) stablecoin launched by Hong Kong-headquartered custodian and trust company First Digital. While the SEC’s stance towards Binance and its broader enforcement actions may affect licensing applications in Hong Kong, the city’s well-established regulatory framework provides a stable environment for digital asset transactions.

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Why Trust CoinGape

CoinGape has covered the cryptocurrency industry since 2017, aiming to provide informative insights Read more…to our readers. Our journal analysts bring years of experience in market analysis and blockchain technology to ensure factual accuracy and balanced reporting. By following our Editorial Policy, our writers verify every source, fact-check each story, rely on reputable sources, and attribute quotes and media correctly. We also follow a rigorous Review Methodology when evaluating exchanges and tools. From emerging blockchain projects and coin launches to industry events and technical developments, we cover all facets of the digital asset space with unwavering commitment to timely, relevant information.

About Author
About Author
CoinGape comprises an experienced team of native content writers and editors working round the clock to cover news globally and present news as a fact rather than an opinion. CoinGape writers and reporters contributed to this article.
Investment disclaimer: The content reflects the author’s personal views and current market conditions. Please conduct your own research before investing in cryptocurrencies, as neither the author nor the publication is responsible for any financial losses.
Ad Disclosure: This site may feature sponsored content and affiliate links. All advertisements are clearly labeled, and ad partners have no influence over our editorial content.