The Hong Kong Securities and Futures Commission (SFC) plans to approve more cryptocurrency exchanges to operate in Hong Kong by the end of the year, according to its CEO Julia Leung. Speaking on Oct. 6 with local outlet HK01, Leung said that 11 of the platforms that have applied for a license have now undergone on-site reviews. She expects further progress in their applications by the end of the year.
Her comments came following the approval of local exchange HKVAX’s application last week. The company, which aims to launch its platform in Q4 this year, is the third exchange in the city to receive regulatory approval. HashKey and OSL also have operating licenses, which were upgraded from licenses they already held under the previous regulatory regime. Bullish, the parent company of CoinDesk, has also applied for a license.
Among those who withdrew are OKX and Bybit, both of which canceled their applications in May and did not disclose the reasons for doing so. The South China Morning Post reported that one major factor may have been an SFC notice that they must prevent mainland Chinese residents from accessing their services.
In an opinion piece in the Hong Kong Economic Journal shortly after OKX withdrew its application, lawmaker Duncan Chiu warned that the approval conditions borrowed concepts from traditional finance that he believed were too strict to apply to web3. He added that the remaining applicants were “small in scale.”
At the same time, lawmakers have argued that the SFC also bears the brunt of criticism when scam exchanges exploit Hongkongers. It came under fire last year for the collapse of JPEX, a rogue exchange that has left over 2,600 Hongkongers some $200 million out of pocket. Over 70 people have been arrested as part of a police investigation into the exchange but to date nobody has been charged.
