- Hong Kong to set rigorous checks on all virtual asset service providers
- The Law is approved to protect investors and consumers
- Crypto exchange service providers will also be subject to this legislation
In an effort to combat money laundering and terrorist financing, the Hong Kong legislature approved an amendment allowing virtual asset service providers to be included in its anti-money laundering and terrorist financing laws.
In June 2023, a new licensing regime will be introduced for virtual asset service providers. This legislation will apply to crypto exchange service providers in the same way as it does to traditional financial institutions.
To obtain a license of operation in Hong Kong, virtual exchanges will have to abide by rigorous anti-money laundering and investor protection laws. Hong Kong’s regulators have mitigated regulatory risks associated with centralized exchanges following the FTX collapse.
In the wake of the collapse of the FTX crypto exchange, regulators from around the world have been criticized for failing to protect retail investors. Crypto exchanges and service providers have been under growing pressure to be legally regulated and subject to strict AML and investor protection measures.
In other news, Spain’s Central bank digital currencies (CBDC) projects are seeking proposals from financial institutions and tech companies.
In an official statement, the bank said the program simulates the use of a CBDC in wholesale transactions. Wholesale transactions involve transfers of funds between banks and financial institutions.
Additionally, cryptocurrency market sentiment continues to be bearish. This also contributes to the massive layoffs happening on most cryptocurrency exchanges.
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