On June 6, the Hong Kong Securities and Futures Commission updated the list of virtual asset trading platforms. According to the Anti-Money Laundering and Terrorist Financing Ordinance, 1 platforms including HKbitEX, PantherTrade, Accumulus, DFXLabs, Bixin.com, xWhale, YAX, Bullish, Crypto.com, WhaleFin, and MatrixportHK were deemed to be licensed; only 11 platforms including BGE, HKVAX, VDX, bitV, HKX, and bitcoinworld were not deemed to be licensed in the application list. The Hong Kong Securities and Futures Commission reminded that all virtual asset trading platform applicants listed in the list have not been licensed and may not comply with the requirements of the Securities and Futures Commission. The Hong Kong Securities and Futures Commission has reminded the public that the non-violation period of virtual asset trading platforms operating in Hong Kong under the Anti-Money Laundering Ordinance will end on June 6.
List of applicants for virtual asset trading platforms
This list sets out the names of virtual asset trading platform operator applicants (virtual asset trading platform applicants) whose licence applications have not yet been approved by the SFC (Note 1), and includes those virtual asset trading platform applicants deemed to have been licensed on 2024 June 6. All virtual asset trading platform applicants listed on this list areNot yetLicensed by the Securities and Futures Commission, andnot necessarilyPlease note that the CSRC has notDon't HaveOfficially issue licenses to virtual asset trading platform applicants who are deemed to have been licensed.
The purpose of this list is to help the public determine whether a virtual asset trading platform has made false or misleading statements about its application for a license with the SFC.
Investors should refer to the above SFC's "List of Licensed Virtual Asset Trading Platforms" to obtain the names of virtual asset trading platform operators that have been formally licensed by the SFC. The SFC also reminds investors to be wary of the risks of buying and selling virtual assets on platforms that are deemed to be licensed virtual asset trading platform applicants (such applicants may not necessarily be ultimately licensed and may have to wind up their business in Hong Kong) or unregulated virtual asset trading platforms (including any unregulated overseas virtual asset trading platforms) (Note 2).
Virtual asset trading platform applicants should not carry out their business activities in Hong Kong or actively promote their services to Hong Kong investors unless they are deemed to be licensed.
| The company name of the virtual asset trading platform operator | Virtual asset trading platform | Date of Submission of Licence Application* | |
|---|---|---|---|
| English | 中文 | ||
| Hong Kong BGE Limited | not applicable | BGE | not applicable# |
| Hong Kong Digital Asset EX Limited^ | Hong Kong Digital Asset Trading Group Co., Ltd.^ | HKbitEX | not applicable# |
| Hong Kong Virtual Asset Exchange Limited | Hong Kong Virtual Asset Exchange Limited | HKVAX | not applicable# |
| Victory Fintech Company Limited | Shengli Digital Technology Co., Ltd. | VDX | not applicable# |
| Panthertrade (Hong Kong) Limited^ | Cheetah Trading (Hong Kong) Limited^ | PantherTrade | 15/11/2023 |
| Accumulus GBA Technology (Hongkong) Co., Limited^ | Cloud Account Greater Bay Area Technology (Hong Kong) Co., Ltd.^ | Accumulus | 06/12/2023 |
| DFX Labs Company Limited^ | not applicable | DFX Labs | 27/12/2023 |
| NewBX Limited^ | not applicable | Bixin.com | 24/01/2024 |
| Thousand Whales Technology (BVI) Limited^ | not applicable | xWhale | 25/01/2024 |
| HighBlock Limited | not applicable | bitV | 06/02/2024 |
| YAX (Hong Kong) Limited^ | not applicable | NEAR | 07/02/2024 |
| Bullish (GI) Limited^ | not applicable | Bullish | 07/02/2024 |
| Foris DAX HK Limited^ | not applicable | Crypto.com | 09/02/2024 |
| Whalefin Markets Limited^ | not applicable | WhaleFin | 21/02/2024 |
| Flying Hippo Technologies Limited^ | not applicable | Matrixport HK | 26/02/2024 |
| hi5 (Hong Kong) Limited | not applicable | HKX | 29/02/2024 |
| Bitcoin World Technology Limited | not applicable | bitcoinworld | 17/05/2024 |
*License applications may be returned by the SFC if they are incomplete and/or have significant unresolved issues.
List of applicants whose licence applications have been returned, refused or withdrawn
This list sets out the names of virtual asset trading platform applicants that have been removed from the “List of Virtual Asset Trading Platform Applicants” because the relevant license applications have been returned, rejected or withdrawn.
The names of applicants for virtual asset trading platforms may be added to this list for reasons including but not limited to the following:
- the licence application is returned by the SFC due to being incomplete and/or having major unresolved issues; and
- The licence application is rejected by the SFC** or withdrawn by the applicant.
*This list only lists the reasons why the SFC removed an applicant from the virtual asset trading platform applicant list.
In response to the recent phenomenon of withdrawing or returning applications for Hong Kong licenses, Hong Kong Legislative Council member Qiu Dagen wrote that when the SFC introduced the licensing conditions, it failed to attract large exchanges such as Coinbase to apply to Hong Kong. Since February, several internationally renowned exchanges such as Gate and Huobi have gradually withdrawn. In May, the situation worsened, with a total of 2 operators announcing their withdrawal, including OKX, which ranks among the top three in global trading volume. Most of the remaining 5 applicants are small in scale. Some lack industry experience, while others are traditional financial institutions trying to get involved in VATP business, but have not deepened their presence in the Web6 field.
Qiu Dagen believes that the new licensing system shows several concerns:
First, several policies and measures related to the development of Hong Kong’s virtual asset market (such as VATP, stablecoin issuance, virtual asset over-the-counter trading, etc.) were designed by different departments, lacking overall strategic considerations for industrial development.Relevant policies entered the consultation stage or were put on the legislative process at different times, causing the entire Web3 layout to be completed in stages, taking too long and failing to keep up with the rapid pace of technological evolution.
Second, the CSRC requires operators to meet standards in asset custody, conflict of interest avoidance, network security, accounting and auditing, risk management, and combating money laundering and terrorist financing. Many of the approval conditions borrow from the operating concepts and conditions of traditional finance, which are overly stringent when applied to Web3 finance.Some applicants told me that the authorities lack the foresight to develop the next generation of financial technology, and that promoting Web3 "financial innovation" with traditional financial thinking lacks flexibility.
Third, many industry insiders believe that the government and regulatory agencies lack the DNA for innovation.At present, the authorities require the management of licensed operators to have many years of experience in virtual asset business. On the other hand, the board of directors and management of officials and regulatory agencies lack personnel with actual experience in operating Web3 business. The two sides have different technical backgrounds, market experience and innovative spirit, making it difficult for them to communicate.
The withdrawal of the licensing system has shaken the confidence of market participants in Hong Kong's promotion of Web3 development. In order to restore market confidence, Qiu Dagen hopes that the SFC will make a decision on the license application as soon as possible so that investors can have long-term confidence in the virtual asset trading platform. Secondly, the products provided by the trading platform must be breakthroughs that can balance the need to maintain a sound legal system, protect investors, and financial innovation. When approving new products in the future, the authorities must show new thinking and determination to encourage Web3 finance.