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The Hong Kong Securities & Futures Professionals Association (HKSFPA) is considering a self-regulatory committee to oversee compliance in its crypto industry.
“Many economically developed regions in the world have established statutory semi-official industry self-regulatory institutions to focus on industry development,” Hong Kong regulators said.
HKSFPA highlighted how there is no organization dedicated to the development of Hong Kong’s financial market industry and that current regulatory practices focus on supervision rather than coordination.
The officials proposed that the Securities & Futures Commission (SFC) could oversee market conduct but could also entrust industry players with its licensing authority.
Additioanlly, HKSFPA proposed the creation of a self-regulatory body comprised of representatives from the futures, asset management, and virtual asset sectors.
However, the effectiveness of self-regulation is questionable. Lithuania, which practised self-regulation, is now backpedalling to tighten its framework from 2025 onwards after granting 580 crypto licenses with limited oversight.
Hong Kong has been pushing policies to benefit the crypto industry. Most recently, Hong Kong police arrested 72 people in connection with the JPEX scandal, which marked the city's biggest case of financial fraud. Three people were also arrested for their involvement in a HK$1.8 billion money-laundering scheme.
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OSL also suggested Chinese firms that received the green light for Bitcoin ETFs in Hong Kong, such as China Asset Management, HashKey Capital Limited and Harvest Global Investments, might debut their products in April.
The Hong Kong Securities and Futures Commission (SFC) officially approved several spot Bitcoin and Ethereum exchange-traded funds (ETFs) earlier this month.
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