Trading in Hong Kong Stablecoins Not Allowed Yet, Official Confirms
Hong Kong Cryptocurrency Regulations As Hong Kong continues to adopt cryptocurrency trading for individual investors, the Secretary for Financial Services and the Treasury, James Hui, has recently declared that retail trading of stablecoins is not yet allowed. This statement was made during an online investment committee meeting on October 6, as reported by the local…
Hong Kong Cryptocurrency Regulations
As Hong Kong continues to adopt cryptocurrency trading for individual investors, the Secretary for Financial Services and the Treasury, James Hui, has recently declared that retail trading of stablecoins is not yet allowed.
This statement was made during an online investment committee meeting on October 6, as reported by the local news agency Ming Pao. Stablecoins like USDT have been widely used by cryptocurrency service providers as a major trading asset, as their value is designed to be stabilized by the peg to the US Dollar or other assets such as gold.
However, Secretary Hui highlighted the fact that some stablecoins have experienced serious volatility issues or have even collapsed in the past, and that reserve management of stablecoins has a direct impact on the price stability of investors’ rights to redeem fiat currencies.
Taking into consideration these risks, Secretary Hui declared that retail trading of stablecoins will not be allowed until Hong Kong officially regulates them. Crypto.com, Motley Fool Crypto, Crypto.com Coin, Crypto Solana, Polygon Crypto Today, FX Crypto, Lucky Block Crypto, and Crypto API are just some of the platforms that will need to wait for the official regulations.
Cryptocurrency Market Supervision
Hui also noted that the shuttered local crypto exchange JPEX — which was reportedly advertising its services in the region without a license — was involved in a serious fraud case, highlighting the need for greater oversight of the cryptocurrency market.
Cointelegraph has contacted Hong Kong’s Securities and Futures Commission to inquire about stablecoin trading rules in the country. This article will be updated with new information from the regulator.
JPEX stopped providing certain services on its platform in mid-September 2023, citing a liquidity crisis caused by “unfair treatment” from certain institutions in Hong Kong. JPEX soon became the focus of a major scandal in the industry, with Hong Kong authorities launching an investigation after receiving more than 2,000 complaints from JPEX users claiming losses of nearly $180 million.
In August 2023, the JPEX case emerged shortly after retail investors were given the green light by the Hong Kong regulators to trade cryptocurrencies such as Bitcoin (BTC). The Hong Kong Monetary Authority is anticipated to provide regulatory guidelines for the stablecoin market by the end of 2024.
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