- HKX to stop operations in Hong Kong as a result of regulatory compliance points.
- 13 crypto exchanges have had their license purposes withdrawn or rejected in Hong Kong.
- One other alternate, Gate.HK, plans to overtake platform to fulfill regulatory requirements and resume operations, after an analogous transfer.
HKX cryptocurrency alternate, hi5 (Hong Kong) Restricted, has introduced its determination to stop operations in Hong Kong. This determination follows challenges in assembly the area’s stringent regulatory necessities.
The announcement was made on July 18, with the HKX administration advising customers to withdraw their property promptly.
HKX withdraws license utility
The Securities and Futures Fee (SFC) of Hong Kong has added HKX to its record of cryptocurrency exchanges which have withdrawn their license purposes.
HKX had initially utilized for the mandatory licenses in February, looking for compliance with each the Securities and Futures Ordinance (Cap. 571) and the Anti-Cash Laundering and Counter-Terrorist Financing Ordinance (Cap. 615).
Nonetheless, regardless of these efforts, HKX struggled to fulfill the regulatory requirements set by Hong Kong authorities.
In an announcement revealed on their official web site, the HKX administration elaborated on their determination stating: “We would like to inform you that our management team has, after careful consideration, decided to withdraw our application for the Type 1 and Type 7 licenses under the Securities and Futures Ordinance and the virtual asset service provider license under the Anti-Money Laundering and Counter-Terrorist Financing Ordinance.”
Crypto exchanges withdraw licenses purposes in Hong Kong
HKX’s determination to exit the Hong Kong market is a part of a broader development. In response to the knowledge on the SFC web site, a complete of 13 cryptocurrency exchanges had both withdrawn their license purposes or had their purposes refused and returned by the SFC by July 22.
The growing regulatory scrutiny and the excessive requirements required for compliance have posed vital challenges for crypto exchanges working within the area.
Gate.HK, one other Hong Kong-based cryptocurrency alternate, had beforehand confronted comparable challenges. OKX additionally withdrew its VASP license utility in Could.
After failing to fulfill the native licensing necessities, Gate.HK withdrew its utility however introduced plans to overtake its platform to align with regulatory requirements. The alternate is presently targeted on permitting withdrawals for its clients and goals to renew operations sooner or later, contributing to the digital asset ecosystem as soon as the mandatory licenses are obtained.
In preparation for its shutdown, HKX had already halted new consumer registrations and suspended buying and selling and deposit companies on Could 29. The corporate emphasised its dedication to aiding customers with the protected withdrawal of their property, guaranteeing a clean transition through the winddown course of.
Nonetheless, there are not any fast plans for HKX to restart companies or reapply for a license.
This wave of exits underscores the advanced regulatory panorama in Hong Kong for cryptocurrency exchanges.
Because the HKSFC continues to implement stringent compliance measures, the way forward for cryptocurrency buying and selling within the area stays unsure, with solely these capable of meet these rigorous requirements prone to proceed operations.
