Speaking at a forum in Shanghai, Hong Kong lawmaker Duncan Chiu said that the region is presently in the middle of a second round of consultations for forming rules to issue stablecoins.
According to local media reports on September 19, 2023, Chiu said that he hopes that the region is able to release the guidelines for stablecoins issuance by the middle of next year.
The lawmaker’s statement comes at a time when Hong Kong is working towards emerging as a Web 3.0 hub. In the past few months, the region witnessed the launch of several crypto companies. In June, Hong Kong also started its own crypto licensing service which allowed authorized exchanges to offer retail trading services. Hong Kong’s stance on cryptocurrencies is in stark contrast to its neighbor the Chinese mainland’s crackdown on cryptocurrencies.
Earlier in August this year, a group of crypto industry experts also urged the Hong Kong authorities to release its own stablecoin, HKDG, which could compete with the likes of the USDC and USDT – both pegged to the US Dollar. The experts maintained that the government’s current plan to allow private institutions to issue stablecoins wasn’t “ambitious enough”.
Meanwhile, as the Hong Kong government works on formulating new guidelines for issuing stablecoins, the region’s authorities have initiated an investigation on “bad players” in the crypto retail trade licensing ecosystem.
On September 19, 2023, the police said that they arrested eight persons on alleged charges of conspiracy and defrauding crypto exchange JPEX. Police said more arrests are likely as the probe progresses. The arrested accused include two social media influencers.
On September 18, 2023, Hong Kong police received 1,641 complaints in connection with the JPEX case with allegations that the complainants were not able to withdraw their holdings with the exchange. According to the complaints, the worth of assets affected by the case was around HK$1.19 billion ($152 million).
Hong Kong’s chief executive John Lee stated that the incident highlighted the need for investors to choose only licensed platforms for investing their virtual assets. Lee advised that crypto investors choose only those exchanges that are regulated by the Hong Kong Securities and Futures Commission. He also said the authorities would work on creating more awareness about investor risks.
Analysts said they are closely monitoring live cryptocurrency prices to gauge any impact on the prospects of the Top 10 cryptocurrencies, following the announcement.
Disclaimer: This article was created for informational purposes only and should not be taken as investment advice. An asset’s past performance does not predict its future returns. Before making an investment, please conduct your own research, as digital assets like cryptocurrencies are highly risky and volatile financial instruments.
