A Hong Kong Lawmaker, Johnny NG has extended an invitation to digital currency exchanges around the world to come to the administrative region of China. Ng in a tweet invited crypto exchanges to apply for official trading platform status.
“I hereby offer an invitation to welcome all global virtual asset trading operators including @coinbase to come to HK for application of official trading platforms and further development plans. Please feel free to approach me and I am happy to provide any assistance,” the tweet said.
It isn’t clear if the lawmaker is extending the invitation on behalf of the government of Hong Kong or he did it independently, but he is definitely a lawmaker interested in cryptocurrency and all that it represents. A look at his Twitter feed will tell you this as his posts are mostly about one crypto gathering or the other.
Ng’s disposition is however a reflection of Hong Kong’s disposition, because the region has also shown tremendous support for cryptocurrencies and is currently one of the top places that crypto startups are running to.
While Hong Kong does not play with the security of crypto investors, it is also interested in allowing the industry grow so that everyone will benefit.
The Opposite of the US
The US has been very hot for crypto exchanges in the last week, with two of the top crypto exchanges, Coinbas and Binance getting sued by the SEC in 24 hours. Sinc then, the exchanges have made som changes such as delisting crypto trading pairs in order to stay afloat in the midst of SEC’s regulatory crackdown.
To make matters worse, the US doesn’t have any regulatory framework for the industry, making it difficult for crypto companies to live up to the expected standard. The SEC chair, Gary Gensler however argues that there is sufficient guidance for crypto exchanges, which he said should be registered with the SEC since they trade in cryptocurrencies the commission considers to be securities.
JP Morgan strategists after analyzing the situation, are of the opinion that crypto exchanges may be forced to register with the SEC in the US as they are likely to be overwhelmed by the ongoing court cases.
“Eventually, the SEC position might be confirmed by lawmakers and Coinbase, Binance.US and other U.S. exchanges would have to register as brokers and most cryptocurrencies would be treated as securities.”
“This could be more onerous and more costly for the crypto industry but there could be positives as well, as crypto markets would be subjected to similar regulations applied to traditional markets such as equities and thus offer more transparency and investor protection,” the note added.
They also argued that this may lead to drafting of a regulatory framework for the industry by the lawmakers, but Hong Kong didn’t need to force crypto exchanges to register with mainstream regulators before bringing a regulatory framework.
Will Crypto Exchanges Accept the Invitation?
Right now, the regulatory pressure in the US has made even indigenous crypto exchanges like Coinbase and Gemini to look outside the country for opportunities. The invitation from Ng is therefore a timely one, but will Coinbase and Binance honor it?
Already, many crypto exchanges like OKX have set up their offices in Hong Kong and many more are trooping there prior to this invitation. Indeed, Hong Kong may become the next crypto hub of the world with such a trend.
