Hong Kong Securities and Futures Commission (SFC), the country’s securities watchdog, is today set to issue rules for licensing cryptocurrency exchanges.
Ashley Alder, head of the SFC, announced the news at a forum on Wednesday, as reported by Reuters. Alder said that the rules will “enable virtual asset trading platforms to be regulated by the SFC, a major development which builds on a way forward I outlined at the same time last year.”
The regulatory framework will cover custody and know-your-customer (KYC) rules, among other issues, per the report.
The move appears to be a positive development for the cryptocurrency industry in general. It could also benefit Huobi, in particular, as the cryptocurrency exchange is planning a backdoor initial public offering (IPO) in Hong Kong. In Sept. 2018, Huobi acquired Hong Kong-listed electronics manufacturer Pantronics Holdings to get reverse-listed on the Hong Kong Stock Exchange, and recently Pantronics said that it will change its name to Huobi Technology Holdings Limited.
The upcoming SFC framework could provide Huobi and other cryptocurrency exchanges with more clarity on the listing processes.
Other companies in the cryptocurrency space, including miner manufacturers Bitmain and Canaan Creative, were also seeking to go public in Hong Kong, but their attempts lapsed. Canaan moved its IPO application to the U.S., while Bitmain also has reportedly filed its IPO application in the U.S.
This is a developing story… The Block will update it when the SFC issues the regulatory framework.