A 12 months after the Hong Kong Securities and Futures Fee (SFC) revealed preliminary laws for funds investing in crypto, just one agency has efficiently handed that gauntlet.
Hong Kong-based Diginex stays the only crypto fund to go the regulatory hurdles issued in Nov. 2018 and formalized this October, in response to analysis from Reuters.
As CoinDesk reported on the time, the 2018 framework utilized new laws to any fund that invested 10 % or extra of its portfolio in digital property. The 37-page steerage issued final month adopts many normal practices held by funds overseen by the regulator already, reminiscent of capital reserves available. New guidelines embrace who can act as custodian for crypto property, for instance.
Nonetheless, just one agency has cleared the SFC’s hurdles to-date, Reuters says, whereas different funds are transferring out of Hong Kong to “skirt” the SFC. Many companies are additionally making use of for approvals with out the intention of receiving the license, however only for appearances, in response to the Reuters analysis.
Nevertheless, exterior components stay for the low quantity, together with doable hangover from the crypto bear market that could be giving spurned funds second ideas.
“The volatility and poor returns in 2018 scared massive establishments away from allocating to crypto funds, inflicting those that survived to shelve their licensing plans,” Jehan Chu, companion at Kenetic Capital, a enterprise capital agency specializing in digital property, informed Reuters.
SFC declined to touch upon each the method and pending purposes, Reuters mentioned.
Hong Kong picture through Shutterstock
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