The Chinese government announced a ban on cryptos at the end of September 2021. But, while Hong Kong has signaled its ambitions in the sector, Beijing seems to support it. In any case, the Chinese government has not expressed its opposition to these ambitions. This calls into question his position regarding crypto issues in China. Decryption.
Hong Kong is allowed to conduct crypto business
Hong Kong is aiming to become a crypto hub, as a Bloomberg report from Feb. 20 recalled. Local authorities want to do this by regulating and legalizing the trading of digital assets for retail investors. In this way, they can directly invest in cryptos.
It appears that the Chinese government has so far only displayed no opposition to the Hong Kong aspiration.
In fact, some members of the government have even participated in crypto meetings in Hong Kong. It seems that they wanted to better understand the current events on the subject. It appears that there was a good understanding between the two parties throughout the meetings.
Crypto law expert, Nick Chan, who is a member of the National People’s Congress, has issued a statement on the matter. He indicated that Hong Kong has permission to conduct its crypto business. The only condition is to avoid violations that could destabilize the Chinese financial system.
What would be the objective pursued by Beijing?
The report of Bloomberg revealed that the Chinese government would have a specific goal in supporting the Hong Kong aspiration. Indeed, local players familiar with the matter believe Beijing is using Hong Kong to get into crypto. The Chinese government would use the latter to access transactions.
The Hong Kong Securities and Futures Commission (SFC) announced important news on February 20. The announcement was about the rollout of a new licensing regime for crypto companies. It stated that each CEX must obtain a license from the SFC before offering crypto services. Additionally, the new regime would allow retail investors access to licensed CEXs. The idea is to prevent Hong Kong citizens from turning to unregulated international platforms. The SFC fears that this will happen if they are denied access to the digital asset market in their country.
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