Main Takeaways:-
- The Hong Kong FSC announced instructions on Monday for licensed VATPs and ETFs trying to provide staking services.
- The staking instructions are part of Hong Kong’s newest crypto roadmap.
Crypto platforms with licenses and exchange-traded funds (ETFs) currently offer staking services, bringing the region nearer to its goal of becoming a cryptocurrency centre.
In a statement announced Monday, the Hong Kong Securities and Futures Commission said it presented regulatory instructions about staking for licensed “virtual asset trading platforms” (VATPs) and for crypto ETFs. The SFC said that we have noticed users’ requirements for staking services and the possibility of staking activities to provide for the security of the blockchain ecosystem.
The SFC says that VATPs must get written approval from regulators before offering staking services, and crypto ETFs also need permission to offer staking. Crypto companies must be careful to put in place protections to avoid mistakes, keep clients’ staked crypto safe, and clearly explain the risks involved.
The financial regulator’s staking rules & regulations are part of the Hong Kong government’s plan, revealed in February, to build the region’s cryptosystem. The plan includes 12 actions, such as looking into new token listings, margin trading, derivatives, lending, borrowing, and staking.
The official door to the crypto industry has been opened by Hong Kong. In June 2023, Hong Kong began a new crypto license for a “virtual asset trading platform,” allowing licensed exchanges to offer services to regular users. But at present, to become a crypto centre, the regulator wants to speed up crypto growth, especially with more competition because of Donald Trump’s pro-crypto stance after becoming president of the U.S.
According to the reports, Julia Leung, chief executive officer of SFC, said in Monday’s announcement that expanding the range of regulated services and products is important for the growth of Hong Kong’s virtual asset market. However, this expansion must happen in a regulated environment where the safety of clients’ virtual assets is always the utmost importance in the rules for offering these services.
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