Cryptocurrencies have sort of instigated a massive amount worry in the minds of regulators all across the globe. The task of creating and evolving a regulatory frameworks for crypto trading, has been a cumbersome task for many economies. The chairman of Hong Kong Securities and Futures Commission (SFC) stated the importance of this framework in a recent interview.
Carlson Tong Ka-Shing, the current chairman of the SFC will hand over the reins to incoming SFC Chairman Tim Lui Tim-Leung on Oct. 19. In an interview with South China Morning Post, Tong expressed that cryptocurrencies pose a significant challenge to legislators.
“We have to carefully consider the regulatory approach for these platforms because they are new technology and may not qualify as securities. They do not fit in the custodian, audit or valuation requirements, for instance, normally expected under the Securities and Futures Ordinance. No other international market currently has a comprehensive regulation (sic) framework for these cryptocurrency platforms.”
Banning is not a solution
While some economies have chosen to ban cryptocurrency trading in their respective country, Tron disagrees with the step. According to him, in today’s day and age, trading can be freely conducted without the constrains of borders and banning trading withing the country might prove a fruitless effort.
“We do not think imposing a total ban on these platforms is necessarily the right approach. Even if we were to ban them, transactions can still be easily conducted via platforms in overseas markets … We need to see if and how these platforms can be regulated to a standard that is comparable to that of a licensed trading venue.”
Angela Kwan,the chief operating officer of Bitmex, the Hong Kong-based cryptocurrency trading platform, suggested that SFC should follow the steps of economies like the U.S. and other leading markets to establish international crypto regulations. Kwan stated:
“We hope the guidelines or regulations being considered will keep pace with market developments.”
Kwan notes that the futures products circulating in the international markets such as U.S. are a perfect example of how regulators support could help crypto industry grow. She added:
“We hope that sharing information about cryptocurrency markets and market developments in this space will help international regulators better understand cryptocurrency as an asset class.”