A detailed account of HKX’s decision to withdraw from the Hong Kong market, examining the regulatory challenges and implications for the crypto exchange landscape.
Points
- HKX withdraws its license applications from Hong Kong’s Securities and Futures Commission （SFC）.
- The exchange halts new user registrations and suspends trading and deposit services.
- Similar exits by other exchanges highlight the regulatory challenges in Hong Kong.
- HKX plans to assist users in safely withdrawing their assets.
- Gate.HK announces a platform overhaul to comply with regulations.
On July 18, HKX, a prominent cryptocurrency exchange, announced its decision to withdraw its license applications to Hong Kong’s Securities and Futures Commission （SFC）. This move comes after the exchange struggled to meet Hong Kong’s stringent regulatory requirements. HKX advised its users to withdraw their crypto assets and stated that it would not reapply for the licenses.
The official notice from HKX mentioned the decision to withdraw applications for Type 1 and Type 7 licenses under the Securities and Futures Ordinance （Cap. 571） and the virtual asset service provider license under the Anti-Money Laundering and Counter-Terrorist Financing Ordinance （Cap. 615）.
HKX initially applied for these licenses in February but, like many others, could not comply with the regulatory standards. This withdrawal aligns with the broader trend in Hong Kong, where a total of 13 cryptocurrency exchanges or trading platforms have pulled their applications, with one having its application returned for undisclosed reasons.
Cointelegraph
In preparation for its winddown, HKX halted new user registrations and suspended trading and deposit services on May 29. The exchange assured users that there are no immediate plans to restart services or reapply for a license but committed to helping users safely withdraw their assets.
Meanwhile, another Hong Kong-based cryptocurrency exchange, Gate.HK, also withdrew its license application after failing to meet local licensing requirements. However, Gate.HK plans to reconstruct its platform to comply with Hong Kong’s regulatory framework, emphasizing measures such as Anti-Money Laundering and Counter-Terrorist Financing protocols.
The exchange stated that it aims to resume operations in Hong Kong in the future, contributing to the virtual asset ecosystem after obtaining the necessary licenses. Currently, Gate.HK only allows fund withdrawals for its customers.
Cointelegraph
解説
- The withdrawal of HKX and other exchanges highlights the difficulties in complying with Hong Kong’s regulatory environment.
- This trend underscores the importance of robust regulatory frameworks for cryptocurrency exchanges.
- The restructuring plans of exchanges like Gate.HK indicate a potential future alignment with regulatory standards, aiming to enhance the virtual asset ecosystem.
- Investors and users should stay informed about regulatory changes and their impact on cryptocurrency platforms.
- The focus on regulatory compliance and secure user transactions will be crucial for the future of cryptocurrency exchanges in Hong Kong.