Hong Kong legislator Johnny Ng has invited Coinbase and other digital asset exchanges to take advantage of the city’s cryptocurrency policy and set up shop in the jurisdiction. Ng extended the invitation on June 10 via a post on Twitter, where he asked the exchanges to apply as official trading partners of the city of Hong Kong, promising the necessary assistance if they decide to take up the offer.
As per the tweet, Ng wrote,
“I hereby offer an invitation to welcome all global virtual asset trading operators, including Coinbase, to come to Hong Kong for the application of official trading platforms and further development plans. Please feel free to approach me, and I am happy to provide any assistance.”
The invitation from Ng came at a time when US-based exchanges are under intense pressure from regulators in the country. In the span of one week, the US Securities and Exchange Commission filed suits against Coinbase and Binance’s subsidiary in the US, Binance US.
Service for retail investors
I hereby offer an invitation to welcome all global virtual asset trading operators including @coinbase to come to HK for application of official trading platforms and further development plans. Please feel free to approach me and I am happy to provide any assistance. pic.twitter.com/bcIi1IjMlc
— Johnny Ng 吴杰庄 (@Johnny_nkc) June 10, 2023
In May, Hong Kong’s regulator, the Securities and Futures Commission (SFC), announced that it would start accepting applications from digital asset exchanges on June 1. Under its new policy recommendation, cryptocurrency exchanges can be licensed to operate within its jurisdiction provided that they serve retail investors with full disclosure of the risks involved. The new guidelines mandate that exchanges not delve into stablecoins until a regulatory framework is approved for the assets.
The policy recommendation by SFC was the outcome of 152 submissions received from the public after the regulator asked for public opinion on the matter. New operators are expected to perform KYC checks on their clients to make sure that they do not serve retail traders from China, where crypto trading has been banned.
No airdrops and giveaways
The Hong Kong crypto policy says that operators are not allowed to offer giveaways, a popular promotional method called airdrops in crypto parlance.
OKX and Huobi, two popular digital asset exchanges, have already taken the lead in applying for authorization permits to operate in Hong Kong. With the increased scrutiny and lawsuits against US-based exchanges, the invitation from Ng may have come at the right time.