Hong Kong’s Treasury Secretary Christopher Hui has defended the government’s move to restrict crypto trading to only millionaires, calling it step in the right direction.
During an appearance at StartmeupHK virtual fintech summit on Thursday, Hui lauded the initiative, noting that it is in line with the city’s plan to properly police the crypto sector.
Hong Kong’s Financial Services and the Treasury Bureau (FSTB) recently released a proposal calling for a ban on retail crypto trading. The agency argued that the minimum threshold for investing in the crypto sector should be about $1 million. Sadly, if the proposal, which is set to be presented before the city’s legislature scales through, about 86% of the city’s population will be excluded from the crypto market. Furthermore, as part of its move to further police the emerging sector, the agency will establish stricter regulatory policies for cryptocurrency exchanges.
Surprisingly, Hui does not see anything wrong with the decision. Instead, he stated that:
We are of the view that a proper regulatory system could facilitate development and at the same time protect investors and adhere to international regulatory standards… Imposing mandatory requirements to protect investors, prohibit market manipulation, and guard against money laundering and terrorist financing, we believe the proposed regime will further facilitate the development of the virtual assets industry in Hong Kong, leveraging our world-class regulatory framework.
In addition to stopping retail players from accessing the crypto market, the city’s restrictive laws could also send exchanges packing even though the government plans to issue operating licenses to foreign companies.
In December last year, the FSTB introduced a legislative proposal that would allow only “professional investors” to trade in cryptos. The consultation period for the proposed rule elapsed in February, BTC PEERS reported. However, critics have argued that the move would likely be inimical to the city’s financial innovation agenda.
While Hong Kong may be playing to the satirical tone of “the rich getting richer and the poor getting poorer,” China appears to be taking a more stringent stance. Regulators in the East Asian country recently said that they will be clamping down on Bitcoin mining and trading activities. The announcement is still laced in a lot of mysteries as the government is yet to issue an official statement or guideline.