Part 4/10:
Addressing market turmoil and failures like the collapses of major exchanges such as FTX and Crypto.com, Quay highlights the importance of robust regulation. Hong Kong’s policy stance remains cautious but optimistic, with an emphasis on creating a comprehensive regulatory regime that prioritizes investor protection and financial stability.
Since releasing its policy statement on virtual assets, Hong Kong has taken significant steps. From June onward, the Securities and Futures Commission (SFC) mandated exchanges to segregate client assets and maintain certain financial reserves, aligning their oversight with that of traditional financial institutions. Prohibiting proprietary trading activities of exchanges further underscores the city’s intent to foster a responsible virtual asset sector.