Hong Kong: Crypto Investors Face Deadline to Switch to Licensed Platforms

Hong Kong’s Securities and Futures Commission (SFC) issued a notice today (Monday) urging virtual asset investors to invest only through licensed exchanges. The notice came before the deadline of 29 February when all crypto exchanges in Hong Kong must obtain or apply for a virtual asset trading platform (VATP) license.

Hong Kong’s Deadline for Crypto Users

The notice further highlighted that if virtual asset investors are “not certain about the regulatory status” of the exchange platform they are using, they should check the regulator’s list of virtual asset trading platforms.

“Investors should check whether a VATP is on the ‘List of licensed virtual asset trading platforms’ or the ‘List of virtual asset trading platform applicants’,” the SFC noted. “VATPs on the ‘List of licensed virtual asset trading platforms’ are formally licensed by the SFC. VATPs on the ‘List of virtual asset trading platform applicants’ include VATPs operating in Hong Kong which have submitted license applications to the SFC on or before 29 February 2024.”

“Investors should check the regulatory status of a VATP from time to time and in any event on 1 March 2024.”

The regulator further highlighted that the crypto investors currently investing through unlicensed platforms must close their accounts by 31 May or transfer their holdings to a licensed platform.

“The SFC, however, reminds the public that the applications submitted by applicants on the 'List of virtual asset trading platform applicants' are still being processed, and they may – or may not – be approved; hence, trading on these platforms carries a risk,” the SFC added.

JPEX Fraud Pushing Regulations

Last year, the regulator in Hong Kong published the names of all locally licensed crypto platforms, along with the ones that have applied for a license. The move to increase transparency came after the regulator busted JPEX, a cryptocurrency falsely claiming to be awaiting a Hong Kong crypto license.

The SFC labeled JPEX a fraud that swindled many Hong Kong residents. Hong Kong police received complaints from more than 1,600 investors involving HK$1.2 billion in crypto assets. It was said to be the largest crypto scam in the jurisdiction.