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Through this regulatory action, the Securities and Futures Commission (SFC) has demonstrated its dedication to promoting a safe and open environment for the trading of virtual assets.
Hong Kong Regulators Mandate Crypto Exchanges to Apply for Licenses or Cease Operations by February 29
As per Cointelegraph, it is a legal requirement that any cryptocurrency exchanges that have not yet submitted an application for an operational license to the Securities and Futures Commission (SFC) of Hong Kong immediately suspend their operations in the region.
Hong Kong regulators issued a clear ultimatum to cryptocurrency exchanges to reduce the dangers that investors face. The ultimatum stated that the exchanges must either apply for a license by February 29 or cease operations within three months.
Furthermore, during this time period, over twenty-two Bitcoin exchanges submitted applications for licenses to continue operating inside the region. However, a significant number of these exchanges ultimately decided to withdraw their applications close to the deadline.
Withdrawals from the Hong Kong market were made by six cryptocurrency exchanges in the month of May alone. These exchanges included global players such as OKX and Huobi HK.
However, unlike most exchanges, Hong Kong-based Gate did not provide any explanations for the unexpected turn of events.HK said that to comply with Hong Kong's regulatory standards, it would be necessary to do a "major overhaul" of its trading platform.
Gate.HK Halts Operations and Delists Tokens Following License Revocation, Users Must Withdraw by August 28
In the aftermath of the license being revoked, Gate.HK suspended all marketing and user acquisition efforts. Users who are already registered have until August 28th to withdraw their cash.
Starting on May 28, the Gate.HK trading platform will no longer be functioning. Additionally, all previously tradable tokens, including Bitcoin, Ether, Solana, and Polygon, will be permanently delisted during this time.
Gate.HK is now undergoing the aforementioned revamp. We may resume our operations in Hong Kong and contribute to the ecosystem of virtual assets in the future, provided that we have obtained the necessary permissions.
As of the 31st of May, 18 cryptocurrency exchanges have submitted applications to obtain a license to operate in Hong Kong. As stated by the SFC, the list of swaps that have been granted approval will be made public by the first of June. HashKey and OSL Exchange are the two cryptocurrency exchanges that have been granted permission to operate in Hong Kong at the time of writing.
It is essential to note that cryptocurrency exchanges might not be granted a license and, as a consequence of the decision made by the SFC, might be obliged to cease their operations in Hong Kong on account of the decision.
The Securities and Futures Commission (SFC) recommends that investors check the official list of acceptable exchanges to reduce the risks associated with trading cryptocurrencies.
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