- Hong Kong exchange OSL says that after the JPEX case, the government has become faster in approving new crypto products.
- Since the JPEX case, non-compliant platforms are monitored closely, and publicity at stations is not allowed.
- In the future, Hong Kong banks will enter the crypto industry in large numbers, especially the tokenized virtual assets industry.
OSL Digital Securities, a wholly-owned subsidiary of BC Technology, said that after the JPEX incident, the government authorities are approving crypto products faster than before. After the JPEX incident, the government has been monitoring non-compliant platforms for fear of violating the law. These platforms are also not permitted by the authority to make publicity at the MTR stations.
The licensed virtual asset platform company in Hong Kong, OSL, said that in the future, a large number of Hong Kong banks will enter the crypto industry, with many banks choosing tokenized virtual assets. The Hong Kong government has always supported the licensed virtual asset industry and platforms that are compliant with the rules. Colin Wu on Wu Blockchain, a well-known Chinese reporter in the crypto industry, tweeted on X, sharing insights on Hong Kong’s enthusiasm for enhancing crypto regulations in the city.
OSL has been granted a license for virtual asset development from SFC and claimed that although the process was strict, it was quite fast compared to the time it has taken to grant regulatory approvals in the past. This change in regulatory rules has shown Hong Kong’s position on digital asset regulation.
The JPEX Rugpull caused a massive uproar throughout the industry. It all started when the Hong Kong Securities and Futures Commission (SFC) warned JPEX of its unregulated operations. The Hong Kong police started its investigation against JPEX after receiving over 83 complaints from investors about their inability to withdraw funds amounting to $4.3 million (HK$34 million).
The risks relating to TRC20-USDT on the platform raise concern about the potential involvement of the platform in money laundering crimes. SFC also announced that JPEX had not filed any license applications and had made false claims about obtaining licenses from overseas regulators. The SFC reported that they received over 2,200 complaints from investors, totaling a loss of over $178 million.
The Chief financial technology innovation director and digital director of Sifang Innovative, Chen Yaowen, is optimistic that the industry can operate with compliance. He believes the industry could operate within the rules if banks got involved in virtual assets and the China Securities Regulatory Commission started reviewing and approving the products. It can also give investors and the public the confidence to invest in virtual assets. He also claimed that when it comes to developing tokenized virtual assets, the banks have great room for development.
