Hong Kong’s crypto industry eager for policy support as regulation, Covid-19 bruises city status as digital asset hub
- Cryptocurrency investors are speaking out against regulatory ambiguity amid fears of a greater industry exodus
- Many large crypto-related firms and events have moved to cities with friendlier rules such as Singapore after two years of Covid-19 restrictions in Hong Kong
“There was a point in time where Hong Kong had a leading position in cryptocurrency and business related to crypto,” said Padraig Walsh, a partner at the Hong Kong law firm Tanner De Witt. “That isn’t the case any more, and I think regulation has been a key part of the reasons why.”
Token2049, a major industry conference that was held in Hong Kong before the pandemic, will take place in Singapore next week for the first time.
“A lot of the guys were in Hong Kong, but for one reason or another they have moved to different places,” said Yang He, co-founder and CEO of Aspen Digital, a Hong Kong-based crypto asset management firm. “Obviously it’s a shifting world and crypto is very fluid, but part of that is a lack of clarity and a lack of the speed of things.”
Through an amendment to the city’s anti-money-laundering law, Hong Kong is moving forward with a new regulatory framework that requires mandatory licensing for cryptocurrency trading platforms. This would require companies to only offer such services to professional investors, meaning individuals with a portfolio of at least HK$8 million (US$1 million).