Hong Kong’s New Crypto Regulations Leave Gray Area, Claims AAX Exchange
Marie Huillet's original article for cointelegraph.com reduced by 47%
As the South China Morning Post reported on Nov. 7, the Atom Asset Exchange uses the Millenium Exchange matching engine developed by the London Stock Exchange and promises prospective clients lower trade latency and trade data transparency. SFC brings security tokens and crypto futures under its remit.
AAX's launch comes just one day after Hong Kong's securities regulator, the Securities and Futures Commission, released new guidance for domestic cryptocurrency exchanges. "Hong Kong hosts dozens of virtual asset trading platforms which pose serious investor protection concerns. A number of these may decide not to seek an SFC license under the new regulatory framework.
This is a course of action which is open to them simply by ensuring that no virtual asset traded on their platforms is a 'security' or 'futures contract.'". As SCMP notes, the SFC's chief executive Ashley Alder has stressed this week that certain crypto futures or derivatives contracts that offer high leverage pose high risks and could potentially be deemed illegal in the region. "We welcome the SFC's latest guidance.
AAX has always envisaged operating in regulated markets for cryptocurrencies that encourage innovation but that also provide investor protections. We see the SFC's announcement as an important step in that direction." This March, the SFC released regulatory guidelines for Security Token Offerings, indicating that security tokens are likely to be classified as securities under Hong Kong's Securities and Futures Ordinance, and thus fall under existing securities laws.
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Summarised crypto news.