The Hong Kong Securities and Futures Commission’s “safety first” regulatory approach to virtual asset trading platforms is very valuable

Despite the recent withdrawals, the recent "deemed licensed" exchanges have still inspired some optimism about the future of Hong Kong's virtual asset market. Hong Kong Legislative Council member Qiu Dagen recently wrote an article questioning the impact of the exchange withdrawal on the development of Hong Kong's Web3, but many industry insiders believe that the Hong Kong Securities Regulatory Commission's "safety first" regulatory approach to virtual asset trading platforms is valuable. Alessio Quaglini, co-founder and CEO of Hex Trust, a Hong Kong cryptocurrency custody provider, said that it is natural for virtual asset trading platforms to withdraw their applications because they need to balance the size of Hong Kong's retail market with high regulatory costs and the impact on their global business. If the goal is to position Hong Kong as a global hub, then a strict regulatory framework strategy is reasonable, but execution should be improved. Jonathan Crompton, partner at RPC Law Firm in Hong Kong, said that the core principles of the Hong Kong Securities Regulatory Commission's regulation of cryptocurrencies emphasize investor protection and require virtual asset market participants to meet the same standards as traditional financial market participants. The exchange's withdrawal of license applications shows that the Hong Kong Securities Regulatory Commission will not let the market go at all costs. (South China Morning Post)