According to a report from Bloomberg, Hong Kong intends to legalize Bitcoin and cryptocurrency retail trading which goes against the city’s position over the last few years and China’s ban on these types of services.
Hong Kong and many other regulatory agencies of the government want to develop a mandatory licensing regime that may be enforced as early as March 2023.
Regulators are requesting permission to list Bitcoin and other cryptocurrencies, but the city will not support any particular asset at this time. There is currently no announcement for timetables and details for how these regulations will be implemented.
However, it is likely that the criteria for listing Bitcoin and other cryptocurrencies will be determined by their market value, liquidity, and inclusion in independent crypto indexes.
On October 31st during a fintech conference, the government is expected to provide information regarding its previously declared objective of becoming a hub for Bitcoin and cryptocurrencies. According to the report, the city wants to restore its status as a major financial center by accepting digital assets.
Co-founder of the Bitcoin Association of Hong Kong Leonhard Weese stated that many people are concerned that there will be a very strict licensing regime within the city. “Even if they’re able to deal directly with retail users, they’re still not going to be as attractive or as competitive as overseas platforms,” added Weese.
The report mentioned that tokenized equities and other financial products may also be on the horizon, indicating that Bitcoin and cryptocurrency retail trading in Hong Kong are the first steps to clean up its digital ecosystem.
The report also suggested that Hong Kong might follow other nations’ lead in enabling exchange-traded funds to provide institutions and high-net-worth individuals with indirect exposure to Bitcoin and other cryptocurrencies.