Hong Kong Crypto Exchange Licenses Cost Millions
According to Livio Wang, the chief operating officer of HashKey Group, obtaining a crypto exchange license in Hong Kong is now costing applicants several million dollars, a significant decrease from the $25 million required a year ago. In an interview with the Financial Times, Wang clarified that while the licenses are not necessarily in the tens of millions of dollars range, they do amount to tens of millions in Hong Kong dollars, which translates to several million in USD.
Wang explained that the costs associated with preparing for the license review differ from those incurred during the operational stage. He also highlighted that since June 1, Hong Kong regulators have expelled all unlicensed crypto exchanges from the city, threatening noncompliant entities with criminal charges. Presently, there are over 11 firms designated as “deemed to be licensed,” in contrast to just two fully licensed exchanges from the previous year, HashKey and OSL.
During the interview, Wang disclosed that HashKey Exchange currently oversees $500 million in user assets and has facilitated $440 billion in cumulative trades since its inception. He noted a significant increase in customer activity, with activated customers surpassing the previous week by 267% and new activations more than tripling.
In April, following the example set by Coinbase, HashKey established a global exchange based in Bermuda to cater to international users. This new platform, HashKey Global, will not serve Hong Kong, China, the United States, or several other regions, unlike its Hong Kong-based counterpart which was the first to acquire a license to operate in the area.
The implementation of Hong Kong’s exchange licensing system faced setbacks last year when an unlicensed crypto exchange, JPEX, violated regulations and defrauded investors of $166 million before collapsing in September 2023.
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