Hong Kong’s ambitions to turn into the most-desired vacation spot for Web3 and crypto appear to be taking a backseat as among the prime world exchanges have withdrawn their licensing functions from Hong Kong’s Securities and Futures Commission (SFC).
Global Exchanges Withdraw from Hong Kong
As per the native information report, among the prime world exchanges like Binance, Huobi, and OKX have determined to withdraw their software over the past week of May. A complete of 11 exchanges have withdrawn their functions leaving solely 11 candidates on the listing.
The Hong Kong SFC mandates that every one candidates for digital asset buying and selling platform licenses signal a letter of dedication, making certain they don’t have mainland Chinese customers in any area. This requirement poses a major problem for conventional offshore exchanges. OKX tried to kind an trade alliance to contest this stipulation however was in the end unsuccessful.
Some of the trade insiders famous that the withdrawn entity might revise its authorized entity or framework and reapply sooner or later. However, it shouldn’t use a model just like that of offshore exchanges in its software.
Are HK’s Web3 Ambitions Over?
With OKX exiting Hong Kong, many within the crypto neighborhood have began questioning whether or not Hong Kong’s Web3 ambitions are over.
Several people in Hong Kong’s WeChat circles have accused the authorities of timidity and extreme warning when implementing the brand new system. They argue that the authorities’ conservative and risk-averse method, rooted in conventional monetary pondering, has weakened the competitiveness and adaptability of the licenses. Consequently, some operators determined to withdraw their functions on the last stage, regardless of having invested substantial assets and upfront prices.
The writer famous a number of areas of concern with the brand new licensing system. Firstly, numerous insurance policies and measures associated to the event of Hong Kong’s digital asset market—similar to VATP, stablecoin issuance, and digital asset over-the-counter buying and selling—had been designed by completely different departments with out cohesive strategic issues for industrial growth.
These insurance policies entered the session stage or legislative course of at completely different instances, resulting in a phased completion of the whole Web3 structure. This protracted course of has struggled to maintain tempo with the fast evolution of know-how.
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