Key takeaways:
- The SFC and the HKPF have established a working group dedicated to cryptocurrency to address illegal crypto exchange activities.
- The working group will examine the risks of suspicious exchanges, communicate information on suspicious actions, and cooperate on investigations.
A working group specifically dedicated to cryptocurrency has been established by the Securities and Futures Commission (SFC) and the Hong Kong Police Force (HKPF) to address illegal crypto exchange activities.
According to a statement released by the SFC on October 4 in the wake of ongoing arrests and developments involving the Dubai-based JPEX exchange, the group was established following a meeting with the HKPF on September 28.
Eleven people were held a few days before the meeting to be questioned about their potential involvement in the JPEX affair, which the SFC claims involves the company promoting its services in the area without a license.
The working group will examine the risks of suspicious exchanges, communicate information on suspicious actions, and cooperate on investigations with the goal of improving monitoring and investigation of unlawful activities carried out by Virtual Asset Trading Platforms (VATPs).
As a result of the JPEX controversy, Hong Kong’s officials have already indicated that they intend to strengthen regulations governing the cryptocurrency market.
Members of the HKPF’s commercial, cybersecurity, and financial intelligence and investigations bureaus are represented in the group, along with representatives from the SFC’s enforcement division.
Christopher Wilson, the enforcement director for the SFC, said in a statement that the agency was eager to use its resources to tackle “problematic VATPs and protect the interest of investors.”
Eve Chung, the Assistant Commissioner of Police for Crime of the Hong Kong Police Force, claimed that the working group is essential for sharing intelligence and working together to address “challenges arising from VATPs, to better protect the general public of Hong Kong.”
Since then, the SFC has released a list of all exchanges that are licensed, presumed licensed, closing down, and/or have applications waiting, as well as a list of “suspicious VATPs.”
