HashKey's New License Could Spark A Wave of Investment In Hong Kong's Digital Asset Sector

HashKey received a license under Hong Kong's new cryptocurrency regulations, marking a significant step towards legitimizing the retail trading of digital assets in the city.

This development is part of the city's broader strategy to position itself as a global epicenter for the digital asset sector.

The new license allows the exchange to broaden its operations from catering solely to professional investors to now include retail users, the company stated.

The Securities and Futures Commission has yet to officially confirm this development.

In a bid to enhance its services, HashKey has formed a partnership with Standard Chartered Plc to facilitate fiat currency deposit and withdrawal services.

The company also unveiled its new virtual asset over-the-counter trading service.

Previously, HashKey and OSL were the only two cryptocurrency exchanges that held permits under Hong Kong's voluntary licensing program.

HashKey Group, which operates in various sectors including venture funding, asset management, and trading, was reportedly in preliminary discussions to raise between $100 million and $200 million at a valuation exceeding $1 billion, Bloomberg reported in May.

Under the new Hong Kong regulations, cryptocurrency exchanges can offer trading services to both individuals and institutions, provided they obtain and adhere to licenses designed to mitigate the risky practices exposed by the 2022 crash and the subsequent collapse of the FTX FTT/USD platform.

The new rules stipulate that retail investors can only trade in larger cryptocurrencies such as Bitcoin BTC/USD and Ether ETH/USD, which are listed in at least two recognized, investable indexes.

Furthermore, the exchanges are required to conduct risk assessments, provide insurance cover, and ensure asset custody, which could potentially increase their operating costs.

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