When it comes to cryptocurrency and the concept of decentralization, there have been some misconceptions about the safety of the transactions done via the crypto network, and the anonymity of it all has remained a harsh pill for authorities to swallow. To counterfeit it, certain countries have designed and issued their own regulations about how the crypto environment will behave in this region and the rules that people have to abide by, and Hong Kong seems to be doing the same.
It has asked for the temporary closure of all the crypto exchange operations in China for the time being and commits them to obtain a license from the respective territory’s market regulator. Not only this, but the extension of this order simulates that these crypto exchanges limit the offering of their services only for professional investors.
Hong Kong might not be on Board with the Concept of Decentralization
This is a classic example of having no trust regarding the ROI (return on investment) profit value of the cryptocurrencies at all, many investors and state regulatory affairs still believe that cryptocurrencies are not the safest investment vehicles, and given the volatility, this show of concern is somewhat valid. Only the securities and futures commission will have the authority to give out licenses to the valid crypto exchanges, but under no circumstances is the commission obligated to do so. To qualify for the status of the professional investors, the person would have to show no less than $8 million in Hong Kong currency or about $1.03 million in the US currency.
Hong Kong is a vast market when it comes to the availability of crypto exchanges but dealing with the recent proposition of the state indicating the limitation of the service for professional investors and such, these exchanges have raised their concerns. It seems that if these exchanges are to go with these new rules, then most of them will be leaving the Hong Kong market for good, and people would be seeking the service from the unregulated markets because not everyone can register themselves for such an exuberant amount of money.