Ambitious Licensing Vision and Regulatory Compliance
According to the official press release, OKX’s General Counsel, Bing Zhao, expressed the company’s ambitious intentions for pursuing licenses in relevant jurisdictions while committing to work closely with the Securities and Futures Commission (SFC) throughout the application process. The centralized exchange has been developing its plans for over a year and is fully prepared to meet all regulatory requirements for the VASP application.
Hong Kong’s Immense Potential for Crypto Firms
Lennix Lai, OKX’s Managing Director of Global Institutional, stated that Hong Kong holds “immense potential” for cryptocurrency companies. The exchange plans to collaborate with regulators on building the local ecosystem over the next five years.
“Regulation and licensing are key to the future success of the crypto and Web3 sectors. At OKX, we see immense potential in Hong Kong, and are committed to investing in talents and working with regulators over the next five years to continue building the local ecosystem. Through the new VASP regime, the Hong Kong government has created a robust regulatory framework and the right conditions for Hong Kong to become a world-leading virtual asset hub. We’re looking forward to applying for the relevant licences via our Hong Kong entity.”
Establishing Local Entities for Operations
As reported by the South China Morning Post, OKX will establish two entities in Hong Kong: Hong Kong Fintech Company Limited and Hong Kong Custody Limited. The former will apply for brokerage and exchange licenses, while the latter will seek licenses to hold and custody assets.
Hong Kong’s Crypto Regulatory Regime
With the intention to legalize cryptocurrency trading for retail investors on June 1, Hong Kong has been working diligently to establish a regulatory framework for the industry. The VASP license plays a crucial role in this framework, authorizing crypto exchanges to operate within the city-state. Firms without the license will be unable to offer services to retail investors.
Moving to Hong Kong: A Growing Trend
Various exchanges are considering a move to Hong Kong once the regulatory framework takes effect, with some already pursuing the necessary approvals. Regulators are also working to establish banking relationships for crypto firms that comply with stringent KYC and AML requirements, as reported by Bloomberg News.
Upcoming Regulatory Event
An event scheduled for April 28 will be led by the Hong Kong Monetary Authority and the Securities and Futures Commission, the two regulators responsible for overseeing stablecoins and cryptocurrency exchanges.
Key Points
What is OKX pursuing in Hong Kong?
OKX is applying for a Virtual Assets Service Provider (VASP) license to operate in Hong Kong, amidst the city-state’s growing embrace of the cryptocurrency industry.
Why is Hong Kong becoming a hotspot for crypto firms?
Hong Kong is working on establishing a regulatory framework for the cryptocurrency industry, including the VASP license, making it an attractive destination for crypto businesses.
What entities will OKX establish in Hong Kong?
OKX plans to set up two entities: Hong Kong Fintech Company Limited, which will apply for brokerage and exchange licenses, and Hong Kong Custody Limited, which will pursue licenses for holding and custody of assets.
What is the VASP license?
The Virtual Assets Service Provider (VASP) license is part of Hong Kong’s developing regulatory framework for the crypto industry. It authorizes crypto exchanges to operate within the city-state and offer services to retail investors.
When is Hong Kong planning to legalize cryptocurrency trading for retail investors?
Hong Kong intends to legalize crypto trading for retail investors on June 1, following the establishment of its regulatory framework for the industry.
Which regulators are responsible for overseeing stablecoins and cryptocurrency exchanges in Hong Kong?
The Hong Kong Monetary Authority and the Securities and Futures Commission are the regulators in charge of supervising stablecoins and cryptocurrency exchanges in the city-state.
