While Hong Kong welcomes cryptocurrency, digital asset trading remains banned in mainland China.
Hong Kong Legislator, Johnny Ng, has encouraged Coinbase and other global exchanges to set up their shop in the region. The legislator took to Twitter, offering his assistance for Coinbase and other interested parties to register and develop within the former British colony.
Mr Ng, who previously cofounded a Web3 accelerator, is known for his bullish stance on Web3 tech. His call to virtual asset trading platforms coincides with a US SEC clampdown on major players like Coinbase and Binance.
Recall that last week, the commission charged Binance and Coinbase for violating securities laws and operating unregistered entities. The lawsuit has caused a significant setback in the crypto industry, with many unclear about the regulator’s position. Similar to the United States, many other Western countries have espoused a cautious approach to cryptocurrencies. In Hong Kong, the story is the opposite.
Hong Kong Call to Coinbase Part of a Bigger Push
When Mainland China banned crypto exchanges in 2017 and cryptocurrency trading in 2021, Hong Kong was not left behind. The city lost its place as a cryptocurrency hub. However, in 2022, Hong Kong declared its readiness to do business with the digital asset industry.
Since making the announcement, the city has been proactive in formulating regulations. It has also set up compliance measures to facilitate the growth and expansion of the cryptocurrency industry. According to Eddie Yue, the chief executive of the Hong Kong Monetary Authority, the city aims to become a global hub for the crypto industry.
The new policy was met with a rush by crypto trading platforms. However, only two exchanges, OSL Exchange and Hashkey Pro, had successfully registered with the SFC by the end of May. Others like Huobi announced the application was in process, while OKX noted it would offer crypto trading to Hong Kong residents through its app. The latest invitation by the legislator may be just what the city needs to attract more interest from crypto trading platforms.
Mainland China Maintains Its Stance
While Hong Kong welcomes cryptocurrency, digital asset trading remains banned in mainland China. However, a Bloomberg report suggests that Beijing may be open to Hong Kong’s idea of becoming a crypto hub.
Whatever the case, Hong Kong has a lot of hurdles to cross if it is to become a globally acclaimed crypto hub. The city would also face competition from Japan, South Korea, and Singapore which already have more elaborate regulations.
An experienced writer with practical experience in the fintech industry. When not writing, he spends his time reading, researching or teaching.
