Crypto firms are making false claims about Hong Kong licence applications and investors should beware, says SFC
- Some unlicensed virtual asset trading platforms claim that they have submitted applications to the regulator, but have not, says SFC
- SFC said it may ‘take a dim view’ of non-compliant behaviours when assessing licence applications
Some crypto trading platforms are making false claims about their compliance with Hong Kong’s new regulatory regime for virtual assets, according to the city’s securities regulator, which urged investors to be aware of the risks.
Some unlicensed virtual asset trading platforms claim that they have submitted applications to the Securities and Futures Commission (SFC) that allow them to operate in the city legally, but have not actually done so, the SFC said in a statement published on Monday.
Such fraudulent claims, meant to “give the public a false sense of assurance” and aimed at “inducing another person to trade in virtual assets”, is an offence under the Anti-Money Laundering and Counter-Terrorist Financing Ordinance, the regulator said.
Last October Hong Kong announced a major push to embrace the virtual assets sector with the ambition to become a global crypto hub, and in the following months laid out rules that allow centralised crypto exchanges to admit retail customers provided they are approved for a licence by the SFC.
A one-year grace period, starting from June 1 this year, allows exchanges that already had a large presence in the city to continue operations while they make changes to their platforms to comply with the SFC’s rules.