Hong Kong’s Financial Services and Treasury Secretary Christopher Hui have defended a recent proposal by the city’s Financial Services and Treasury Bureau to ban retail crypto trading.
In a speech delivered at the StartmeupHK Virtual Fintech Summit on Thursday, Hui said the proposal was in line with the government’s plan to properly police the emerging crypto market.
As previously reported by Cointegraph, the FSTB issued a proposal after months of consultation calling for a ban on retail crypto trading and the establishment of a strict regulatory regime for cryptocurrency exchanges.
As part of the proposal to be presented before the city’s legislature, the FSTB argued for a minimum investment limit of approximately $ 1 million for crypto trading. The provision will reportedly exclude approximately 93% of Hong Kong’s population from the city’s cryptocurrency market if passed by the government.
However, Hui is of a different view, stating, “Our view is that a proper regulatory system can facilitate development as well as protect investors and comply with international regulatory standards.” According to the Treasury chief of Hong Kong:
“IMPLEMENTING MANDATORY REQUIREMENTS TO PROTECT INVESTORS, PREVENT MARKET MANIPULATION, AND PROTECT AGAINST MONEY LAUNDERING AND TERRORIST FINANCING, WE BELIEVE THAT THE PROPOSED REGIME TAKES ADVANTAGE OF OUR WORLD-CLASS REGULATORY FRAMEWORK, VIRTUAL IN HONG KONG WILL FURTHER FACILITATE THE DEVELOPMENT OF THE PROPERTY INDUSTRY. “
In addition to shutting down retail crypto activity, Hong Kong’s restrictive laws could force out-of-town exchanges despite the government’s plan to allow foreign companies to obtain operating licenses in the city.
Indeed, in December 2020, when the FSTB was still in the midst of its consultation, several industry stakeholders criticized the planned crypto rules. At the time, critics argued that these restrictive virtual currency laws would be hostile to Hong Kong’s financial innovation agenda.
