Hong Kong’s securities regulators are on the brink of granting official licenses to 11 cryptocurrency exchanges, marking a significant milestone in the country’s efforts to become a global hub for digital assets. The Securities and Futures Commission (SFC) had previously issued a proposed regulatory requirement, and now the expected licensing approval is in line with Hong Kong’s broader plan. Among the exchanges close to being officially licensed are Crypto.Com and Bullish, with the SFC stating that these exchanges are “deemed to be licensed” pending the fulfillment of all regulatory requirements. Hong Kong aims to create a safe market for investors within its jurisdiction, and as such, it will carefully review and scrutinize licensing permit applications to ensure compliance. The 11 applicants also include PantherTrade, DFX Labs, xWhale, Accumulus, and YAX. Bybit and OKX have withdrawn their license applications, while Binance, the world’s largest crypto exchange, did not apply. Coinbase Global and Kraken, both US-based, also did not apply for permits, although the SFC granted a grace period until June 1st for crypto exchanges to become fully licensed. Once the SFC verifies continued compliance with its regulations, the exchanges will receive their complete permits. As part of its initiative to establish itself as a global digital asset hub, Hong Kong plans to increase the number of authorized exchanges and introduce Bitcoin and Ethereum exchange-traded funds (ETFs). The country is also developing a regulatory framework for stablecoins and digital bonds on tokenization platforms. However, Hong Kong faces tough competition from other financial hubs like Singapore and Dubai in its quest to become a leading digital asset hub. Leading up to the application deadline in February, about two dozen crypto exchanges had submitted their bids for permits, but many withdrew as the deadline approached. Gate.HK, a Hong Kong-based exchange, stated that it would require a major overhaul of its trading platform to meet the stringent requirements. Currently, only Hashkey Exchange and OSL Group have obtained complete permits to operate as trading platforms for digital assets in Hong Kong.
