Hong Kong further strengthens its Cryptocurrency regulations

Paul Chan, the Financial Secretary of Hong Kong, stated that the country was considering to strengthen the policy of its Cryptocurrency sector by complying with international Anti-Money Laundering (AML) laws. The new regulations are aimed at targeting virtual asset service providers, or VASPs. 

Cointelegraph mentioned this in a tweet:

Cryptocurrency exchanges and precious metal dealers will be subject to Hong Kong’s new anti-money laundering laws https://t.co/3zIBDJGAwV

— Cointelegraph (@Cointelegraph) February 27, 2020

The new regulations can add pressure on crypto exchanges and unofficial brokers in Hong Kong, a global crypto hub. In December the Hong Kong Monetary Authority (HKMA), recommended that the virtual asset service providers stay watchful in self-regulating their customers’ activities. 

HKMA’s AML enforcer, Carmen Chew stated that institutions should keep themselves updated with global developments to fully understand the risks and apply a strategic approach to support responsible financial innovation along with an effective ML/TF risk management. 

Although the global AML watchdog, FATF rated Hong Kong as “largely compliant” with its suggestions regarding upcoming technologies like Cryptocurrency, Hong Kong wants to further enhance its anti-financial crimes model, Chan’s speech indicated. Many states are trying hard to get ahead of FATF’s crypto guidelines. Some have even taken their initial steps in regulating VASPs (such as Paraguay) while others have formed international coalitions to monitor cryptocurrency transactions.