Hong Kong’s aspiration to become a prominent digital-asset hub received a significant boost on June 1st with the introduction of a regulatory framework for digital assets. This dual-purpose initiative aims to protect investors and promote the growth of a digital-asset hub. The Securities and Futures Commission (SFC) has now granted permission for retail investors to trade major tokens on licensed platforms and is also considering the possibility of allowing spot crypto ETFs.
However, the recent collapse of the unlicensed JPEX exchange, which was marred by fraud allegations, has cast a shadow over these efforts. In response, Hong Kong has intensified its oversight of the crypto industry by establishing a joint task force between the SFC and the police.
Despite enduring a market downturn worth $1.5 trillion in 2022 and witnessing significant collapses such as Sam Bankman-Fried’s FTX platform, there is a renewed sense of optimism in the crypto sector. Speculation that the United States may approve the country’s first spot Bitcoin ETFs has played a role in Bitcoin’s price doubling this year.
Financial institutions such as DBS Group Holdings Ltd., ZA Bank Ltd., and SEBA Bank AG are increasingly embracing the crypto economy, reflecting the shifting attitudes towards digital assets within the financial sector.
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