Hong Kong Digital Asset Xchange Limited (HKDAEx) recently submitted a license application to the Hong Kong Securities and Futures Commission (SFC) for operating as a digital asset exchange. The firm, part of the Hong Kong Financial Asset Exchange Group, filed its application on August 27, well past the May 31 deadline set by the SFC. Despite the late submission, the regulator has accepted the application, with the possibility of returning it if it is incomplete or presents unresolved issues.
HKDAEx’s Mission: Bridging Digital and Physical Assets
HKDAEx aims to integrate physical assets with digital ones to boost liquidity and increase their overall value. By doing so, the company seeks to enhance the real economy and support the growing demand for digital financial instruments.
The SFC has been cracking down on unlicensed crypto trading platforms in recent months. As of June 1, it became illegal to operate a virtual asset trading platform (VATP) in Hong Kong without proper licensing. While some firms have received preliminary approval, many are still waiting for full operational licenses.
Ongoing Efforts to Regulate Crypto Trading in Hong Kong
Several exchanges, including Crypto.com, Bullish, HKbitEX, and PantherTrade, are currently in the process of seeking full licenses. To date, only two exchanges—OSL Digital Securities and Hash Blockchain—hold full operational licenses in the city.
Hong Kong continues to refine its regulatory framework to ensure that companies comply with licensing requirements. Those operating under a deemed-to-be-licensed status are subject to temporary conditions while awaiting full approval.
Hong Kong’s Vision for Becoming a Global Crypto Hub
Hong Kong is positioning itself as a key player in the global cryptocurrency market. With advanced tokenization initiatives and a friendly environment for crypto investors, the city is working to become a global hub for digital assets.
Ranked second in the 2024 Henley Crypto Adoption Index, just behind Singapore, Hong Kong boasts significant public interest, a strong economic climate, and tax advantages that foster crypto growth. The city is leveraging these strengths to attract more businesses and investors, aiming to lead the way in the future of financial technology.
