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Competition Heats Up as Cryptocurrency Exchanges and Industry Groups Target Hong Kong Retail Crypto Traders
The competition to attract retail crypto traders in Hong Kong is intensifying as the city's retail trading regime is set to go live on June 1. Several cryptocurrency companies have announced their plans to apply for a license and enter the Hong Kong market.
On May 29, CoinEx, a Hong Kong-based crypto exchange, revealed its entry into the city by launching a local platform called BitHK. CoinEx plans to submit its application for a Virtual Asset Service Provider (VASP) license to the securities regulator on June 1. Similarly, Huobi, another prominent exchange, announced on Twitter that its Hong Kong entity would offer crypto trading to local retail traders.
On May 29, Huobi submitted its Virtual Asset Service Provider (VASP) application to the Securities and Futures Commission (SFC). Gate.io and BitMEX also recently announced their license applications and dedicated crypto trading services in Hong Kong.
Other companies, including OKX, ZA Bank (Hong Kong's largest digital bank), and a subsidiary of the Chinese state-owned conglomerate Greenland Holdings, have expressed their intentions to obtain a VASP license.
In response to the growing interest in the industry, two new crypto industry groups, the Hong Kong Licensed Virtual Assets Association (HKLVAA) and Web3 Harbour, were launched on May 29. The HKLVAA aims to serve VASP-licensed firms and those seeking licensing in the city, while Web3 Harbour focuses on supporting local Web3 development.
The Securities and Futures Commission announced on May 23 that licensed VASPs would be allowed to serve retail investors starting June 1. Companies willing to comply with the SFC's guidelines regarding safe asset custody, security standards, asset segregation, and other requirements are encouraged to apply for a license.
As the retail trading regime becomes operational, the race to capture the Hong Kong market and attract retail crypto traders is expected to intensify, with various cryptocurrency exchanges and industry groups vying for a foothold in the region.