Members of the Legislative Council of the Special Administrative Region of China have been presented with a new bill aimed at combating money laundering and the financing of terrorism.
The authors of the bill propose to introduce licensing of virtual asset service providers (VASP) and registration of dealers in precious metals and stones (DPMS). If the bill passes, Hong Kong companies operating in these two sectors will be required to comply with regulations aimed at combating financial crime.
Cryptocurrency organizations wishing to launch a trading platform will need to obtain a license from the Hong Kong Securities and Futures Commission (SFC) and meet a number of requirements. The proposal takes into account the recommendations of the Financial Action Task Force on Money Laundering (FATF), which sets global standards in this area.
The new requirements are similar to those that apply to companies in the traditional financial services sector. This means that crypto firms will essentially become part of the Hong Kong financial system. Accordingly, these companies will be regulated in accordance with the same standards.
The SFC will also ensure that VASPs adopt proper listing and trading policies and provide financial reporting. In addition, the Commission will monitor the implementation of mechanisms designed to prevent market manipulation and conflicts of interest.
Hong Kong-regulated crypto exchange OSL previously said it would lay off 40 to 60 employees. OSL emphasized that this decision has nothing to do with Terra or other projects that have liquidity problems.
