Jul 11, 2022 1:42 p.m. UTC
July 11, 2022 at 13:42 UTC
New legislation designed to control the crypto zone in the port aims to implement a licensing regime for crypto service providers. Individual changes to the region’s anti-money laundering (AML) rules are before its lawmakers, while a recently released report examines the relevant threats.
Hong Kong lawmakers to consider bill aligning crypto sector with financial sector
The amendments aimed at controlling the cryptocurrency market in the port are granted to members of the China Special Corps region legislators. The Anti-Money and Counter-Terrorist Financing Bill 2022, which was published in the government gazette in June, wants its approval in 2 readings to become law.
The authors of the project introduce a license for virtual providers of quality services (VASP) and registration for traders in precious metals and stones (DPMS). The objective is to impose anti-laundering and terrorist financing obligations on companies operating in the two sectors.
Entities operating with cryptocurrencies that need to launch a commercialism platform, for example, should be required to obtain a license from the port’s Securities and Futures Commission (SFC) and fulfill a variety of necessities. The proposal takes into consideration the recommendations of the Monetary Action Task Force on Concealment (FATF) which sets global standards in the field.
The new needs of VASPs relate to those that apply to legacy establishments in the money services industry and that they may be forced to meet similar monetary adequacy needs, noted Andrew Leelarthaepin, Head of Exchange. Bitstamp crypto for Asia-Pacific, in an article published by the South China Morning Post. In his view, this recognizes crypto companies as part of Hong Kong’s financial setup. the leader says:
Simply put, VASPs will expect to be regulated to a standard equivalent to that of our institutional buyers. The law recognizes VASPs as peer organizations at regular intervals in the money services industry.
Under the forthcoming legislation, the SFC will be responsible for confirming that virtual quality service providers adopt correct listing and mercantilism policies, as well as monetary news and disclosure procedures. The Commission will observe the implementation of the mechanisms intended to put an end to market manipulation and conflicts of interest.
As lawmakers prepare to approve the new regulatory framework, the latest edition of Hong Kong’s Concealment and Terrorist Financing Risk Assessment Report has given explicit attention to threats and vulnerabilities in the crypto space. while acknowledging their potentials and increasing their quality, the paper also highlights the vulnerability of virtual assets to many risks as well as the challenges they create for capitalist protection.