The FSTB aims to enhance control over virtual asset trading by extending anti-money laundering and anti-terrorism financing (AML) regulations to crypto traders who provide over-the-counter digital asset trading services. The proposed legislation also includes the introduction of a mandatory licensing system, whereby all operators must obtain licenses from the Commissioner of Customs and Excise (CCE).
Under the licensing regime, traders will only be allowed to conduct transactions on registered platforms, and clients of over-the-counter crypto traders will need to provide sufficient evidence of ownership or control of their crypto wallets, along with personal data.
Additionally, licensed over-the-counter traders in Hong Kong will not be permitted to trade virtual assets that have not been approved by the Hong Kong Monetary Authority (HKMA).
Interestingly, the Hong Kong Chamber of Commerce (HKGCC) recently approached the government with a proposal to include the issuance of stablecoins pegged to the digital yuan or a basket of fiat currencies in the new financial budget for the region.