The Securities and Futures Commission (SFC) of Hong Kong has placed cryptocurrency exchange MEXC on its warning list. The SFC stated that MEXC is actively promoting its services to Hong Kong investors without being licensed or having applied for a virtual asset trading platforms (VATP) license. According to the SFC, operating a virtual asset exchange or marketing such services to Hong Kong investors without a license is an offense under the Anti-Money Laundering and Counter-Terrorist Financing Ordinance. Cointelegraph has reached out to MEXC for comment.
The SFC also cautioned investors against trading digital assets on unregulated exchanges, as there is a risk of losing their entire investment if the platform ceases operation. This warning comes after the SFC added Bybit crypto exchange to its warning list. Currently, the warning list includes 20 crypto exchanges.
MEXC is ranked as the 11th-largest cryptocurrency exchange in the world by trading volume, with a 24-hour volume of over $2.19 billion. The exchange receives over three million weekly visits and provides access to 1,942 cryptocurrencies, according to CoinMarketCap.
Previously, the SFC has taken action against fake websites impersonating major local crypto exchanges. On March 4, the SFC issued a warning against suspicious websites impersonating licensed crypto trading platforms OSL Digital Securities and Hash Blockchain Limited, also known as HashKey. Some of these fake websites also impersonated MEXC, leading the SFC to blacklist eight domains on February 9.
The deadline for crypto exchanges operating in Hong Kong to file for a VATP application was on February 29. Unlicensed firms must cease operations in the region by May 31. Additionally, exchanges whose VATP applications are rejected by the SFC must leave the city within three months. Currently, only two crypto exchanges in Hong Kong are licensed by the SFC, namely OSL exchange and HashKey Exchange. OSL received its license on December 15, 2020, while HashKey Exchange was licensed on November 9, 2022.
Hong Kong has also begun the second phase of its Central Bank Digital Currency (CBDC) pilot.