JPEX Scandal Pushes Hong Kong’s SFC to Roll Out New Crypto Rules

JPEX Scandal Pushes Hong Kong’s SFC to Roll Out New Crypto Rules

In a move
to bolster retail investors’ protection, Hong Kong’s Securities and Futures
Commission (SFC) has announced a series of new measures this week. These
initiatives come on the heels of the JPEX crypto exchange debacle, which
exposed vulnerabilities in the city’s regulatory framework for virtual assets.
The SFC’s new measures aim to enhance transparency, improve public awareness,
and tighten regulations around crypto trading platforms.

JPEX Blowup Prompted
Response from Hong Kong Regulator

In June
2023, Hong Kong opened up to retail cryptocurrency trading, significantly
relaxing the country’s existing rules. However, the number of licensed
platforms that could provide these services remains small, a fact exploited by
other, unregulated entities to attract new customers. One such exchange was
JPEX, which is now facing serious issues with the withdrawal of investor funds.

To combat
the disinformation, the SFC plans to publish a comprehensive list of licensed Virtual
Asset Trading Platforms (VATPs) on its website. This list will include currently
licensed platforms, those in the application process, and entities that have
been ordered to shut down or are deemed suspicious. The regulator believes this
transparent approach will help investors decide which platforms to engage with.

In addition
to enhancing transparency, the SFC is launching a public campaign to educate
people on protecting themselves against fraud. The commission is committed
to investigating and prosecuting illegal platforms. To this end, the SFC is
ramping up its intelligence-gathering efforts on businesses related to virtual
assets.

„The
SFC will, within its statutory powers, continue to strengthen its intelligence
gathering process towards different businesses related to virtual assets. It
will continue to take follow-up and enforcement actions against suspicious
VATPs that may have violated the law, and refer cases to the Police when
necessary,” the SFC commented
in the official press release.

The
planned actions presented by SFC were summarized in the table below:

Update on JPEX Case

Over the
weekend, 11 individuals connected to the JPEX case were arrested, and
authorities are seeking Interpol assistance to apprehend the exchange’s
leaders. Some cryptocurrencies linked to the fraud have also been frozen. More
than 1,400 complaints have been filed against the trading platform, indicating
losses exceeding HKD 1 billion, or approximately $127.9 million.

Additionally,
Finance Magnates disclosed last Monday that local authorities detained
financial influencer Joseph Lam Chok due to his online promotion of the
troubled exchange. The arrest occurred just a few hours following the
exchange’s latest issues.

The SFC
stated that it would continue to review the regulatory landscape in Hong Kong
and take timely measures in response to new market developments.

„Adhering
to the 'same business, same risks, same rules’ principle, the SFC will work
with the HKSAR Government to regularly review the regulatory regime in Hong
Kong and consider timely measures in light of new market developments. These
measures may include regulation of VA-related businesses other than the VATPs,”
the regulator added.

The SFC has
been proactive in identifying the potential benefits and risks associated with
digital finance and virtual asset activities. Under the Anti-Money Laundering
and Counter-Terrorist Financing Ordinance, which came into full effect on 1
June 2023, the SFC has closed gaps in its licensing and supervision powers over
VATPs. The regulator has imposed stringent requirements to ensure investor
protection, including enhanced due diligence and robust governance measures.

This article was written by Damian Chmiel at www.financemagnates.com.

About Post Author

admin

http://pogotowiefotowideo.pl/mapa-strony/ mapa i spis usług http://pogotowiefotowideo.pl/mapa-strony/ Katalog firm Baza przychodni weterynaryjnych Katalog stron PEKSI WP web site Katalog stron Osuszanie Wodzisław Śląski Internetowy sklep zoologiczny