Hong Kong plans to introduce a new cryptocurrency regulatory mechanism this year: register and monitor business wallets and transaction records, and offenders may be imprisoned for two years

Odaily Planet Daily News Hong Kong regulates cryptocurrency exchanges, but there are only 9 licensed exchanges, and they mainly serve professional investors. Wu Jiezhuang, a member of the Legislative Council of the Hong Kong Special Administrative Region, said that Hong Kong's cryptocurrency regulation will usher in a new mechanism this year. The SAR government will establish a licensing system for cryptocurrency over-the-counter (OTC) transactions and require OTC to comply with the anti-money laundering (AML) and customer due diligence (KYC) provisions of the Anti-Money Laundering Ordinance. In addition, licensees can only conduct spot transactions between virtual assets and legal currencies, and must register and monitor business wallets and transaction records. As a regulator, the Commissioner of Customs and Excise is responsible for approving licenses, routine inspections, investigating violations and imposing penalties. Violators may be fined up to HK$1 million or imprisoned for two years. In terms of KYC certification, the SAR government recommends verifying the identity of customers, evaluating and recording the purpose and nature of customers' transactions, and continuously monitoring trading activities. (Wen Wei Po)