Hong Kong Government Launches Consultation on Regulating Cryptoassets

The Hong Kong Government has launched a consultation to gauge public opinion on legislative proposals designed to enhance anti-money laundering and counter-terrorist financing (AML/CTF) regulation in Hong Kong. The targets include cryptoassets (digital assets) with the introduction of a licensing regime for virtual asset services providers (VASPs). Additionally, there is a consideration for a registration regime for dealers in precious metals and stones and miscellaneous technical amendments under the Anti-Money Laundering and Counter-Terrorist Financing Ordinance. The consultation will last for three months, deadlining on January 31, 2021.

The legislative proposals are intended to bring Hong Kong’s regulatory regime up to date in line with the latest international requirements, as promulgated by the Financial Action Task Force (FATF). The new rules include strict regulations for VASPs including the well-known travel rule that requires platforms to maintain rigorous trading records for crypto transfers.

“The proposals are pertinent to our fulfilment of the relevant FATF obligations and will uphold our credibility as a trusted and competitive place to invest and do business,” a government spokesperson said.

Members of the public may submit their views on the proposals to the Financial Services and the Treasury Bureau by post (24/F, Central Government Offices, 2 Tim Mei Avenue, Tamar, Hong Kong), by fax (2527 0790) or by email ([email protected]) on or before January 31, 2021.

The consultation document is embedded below.

Hong Kong Consultation VASPs 11.3.20
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