OKX , the crypto exchange and Web3 technology company, has set up a Hong Kong entity for launching virtual asset services in the country. The company intends to apply for the virtual asset service provider (VASP) licence under the Anti-Money Laundering and Counter-Terrorist Financing (Amendment) Ordinance 2022 which is scheduled to take effect on 1 June 2023, and the Type 1 and 7 licences under the Securities and Futures Ordinance.

The announcement comes after more than a year of preparation by OKX to fulfil anticipated regulatory requirements from organizational, product, security, and compliance standpoints. OKX representatives see regulation and licensing as key areas to the future success of the crypto and Web3 sectors. The company sees potential in Hong Kong and are committed to investing in talents and working with regulators over the next five years to continue building the local ecosystem.

Through the new VASP regime, the Hong Kong government wants to create a robust regulatory framework and the right conditions for Hong Kong to become a world-leading virtual asset hub. OKX take security, custody, AML, and compliance very seriously and are keen to demonstrate how they can meet and exceed the robust standards expected of virtual asset service providers under this regulatory regime. Over the past several years, Hong Kong has become a destination for the crypto industry, and will be increasingly important for OKX and many other innovative firms, entrepreneurs and top talents as regulation develops.

Getting the Hong Kong licence The China-based cryptocurrency exchange has only recently revealed its plans to apply for licences in Hong Kong considering upcoming regulations. The announcement came in February 2023. As part of a new regulatory package that will be implemented in June 2023, the exchange is now be able to operate in Hong Kong after becoming registered with the Hong Kong Securities and Futures Commission (SFC).

Company officials revealed that the exchange had begun preparatory work for a licence application in Hong Kong in 2022. However, it was only in February 2023, the Hong Kong Monetary Authority has revealed its intention to introduce new regulations on stablecoins and crypto assets. The HKMA was at the time analysing the pros and cons of introducing new regulations or amending existing stablecoin laws.

The HKMA issued a discussion paper on crypto-assets and stablecoins on 12 January 2022, and the paper eventually received 58 responses from public bodies, business, and professional organisations, as well as individuals. .