Hong Kong Stock Exchange: Traditional Rules Should Apply to Crypto, Blockchain
The Hong Kong Stock Exchange (HKEX) has recently published a report about cryptocurrency regulations. Regulation has been the long-term discussion in the markets and HKEX is now the latest party to join the conversation.
They report emerging technologies such as blockchain, it says, could be “integrated in the areas of investment, trading, clearing and settlement,” adding that regulations, too, should be common to all companies in the finance space.
Also HKEX reported different countries could have the different rules but the main schedule must remain the same in order to maintain the balance. Authors said the principle of consistency requires that … the issuance of digital currencies and digital funds must be governed under the existing securities regulatory framework, as they added:
“The public fund-raising activities of shares issuance by issuers — which do so with merely a prospectus published on the internet but without any underwriter nor compliance with the IPO registration procedures or strict disclosure requirements — must be rectified by subjecting them to the governance by the Securities Law.”
Further, bringing similar financial services under existing rules would “maintain fair competition, ensure regulatory effectiveness and prevent regulatory arbitrage,” the report argued.
One potential issue raised, though is that the fast-changing nature of fintech can potentially open up regulatory “loopholes.” As a result, it said, regulations need to be “continuously updated” to keep pace with technological change.