Hong Kong’s Securities and Futures Commission (SFC) has taken significant steps to improve investor education and combat fraud in the wake of the JPEX debacle. The financial regulator announced on September 25th that it would be publishing a comprehensive list of licensed Virtual Asset Trading Platforms (VATPs) on its website. This list will provide transparent and timely information about licensed platforms, those in the application process, entities ordered to shut down, and suspicious entities. By doing so, the SFC aims to alert investors about the businesses they should interact with and protect them from potential scams and fraudulent activities.
In addition to the comprehensive list, the SFC plans to launch a fraud prevention publicity campaign. This campaign aims to educate the public on ways to protect themselves against fraud in the cryptocurrency industry. By providing information and raising awareness, the SFC hopes to empower investors to make informed decisions and avoid falling victim to scams.
The SFC is also taking a firm stance against illegal platforms. It has pledged to investigate and prosecute these platforms, demonstrating its commitment to ensure the safety and integrity of the virtual assets market in Hong Kong. To strengthen its efforts, the SFC intends to enhance its intelligence-gathering process related to virtual assets-related businesses. By gathering reliable information on potential illegal activities, the SFC will be better equipped to take appropriate action and protect investors.
Recognizing the importance of discussing and addressing the loopholes in current regulations that contributed to the JPEX incident, Hong Kong lawmaker Johnny Ng has urged the establishment of a subcommittee focused on the emerging industry. This subcommittee, as proposed in Ng’s letter to the legislative council, would complement recent regulatory reforms and facilitate discussions on the development of Web3 and virtual assets. Johnny Ng, a pro-crypto lawmaker, has been a vocal supporter of the industry in Hong Kong and is actively engaged in promoting its growth and security.
Following the collapse of JPEX, the police have taken action by arresting 11 individuals connected to the case. The authorities are also seeking Interpol’s assistance in pursuing the exchange’s leaders. Furthermore, the police have successfully frozen some cryptocurrencies linked to the fraud, aiming to recover assets for the victims.
The SFC recognizes the need for continuous review and adaptation to evolving market developments. It acknowledges that the regulatory regime in Hong Kong must remain dynamic to effectively respond to new challenges and protect investors. The SFC, therefore, commits to regularly reviewing the regulatory framework and implementing timely measures as required. Furthermore, the SFC aims to collaborate closely with the Police to establish a dedicated channel for sharing information on suspicious activities and breaches by VATPs. This collaboration will help investigate the JPEX incident thoroughly and bring those responsible to justice.
With the introduction of new measures, Hong Kong’s SFC is prioritizing investor protection and education in the virtual assets market. By publishing a comprehensive list of licensed VATPs and launching a fraud prevention campaign, the SFC aims to empower investors with knowledge and mitigate the risks associated with fraud. The commitment to investigate and prosecute illegal platforms, as well as the proposed legislative subcommittee focused on the emerging industry, further demonstrate Hong Kong’s dedication to fostering a secure and robust virtual assets ecosystem. Through continuous review and collaboration, the SFC seeks to ensure that its regulatory regime remains effective in safeguarding investors’ interests and maintaining market integrity.
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