Government's definition of virtual assets
▪ Expressed in units of measure or as a store of economic value
▪ Meets one of the following as a publicly acceptable medium of exchange or intended to be used for one or more of the following purposes:
-Payment for goods or services.;
-discharge of debts;
-Investment
▪ Provide the right, capacity or means to vote on the management, operation or governance of any affairs relating to the crypto-protection of digital form value or any change in the terms of any arrangement applicable to the crypto-protection of digital form value;
▪ Can be transferred, stored or traded electronically
Basically, popular cryptocurrencies such as BTC/ETH/BNB/USDT are virtual assets. Governance tokens such as the DAO Token also play a role.
However, this amendment only targets exchanges, and holding or trading cryptocurrencies will remain legal for the time being.
Where centralized exchanges go
License required to operate virtual asset service business。
▪ To carry on the business of providing any virtual asset services;
▪ Showing that you are in the business of providing any virtual asset services
Most of the large-scale centralized exchanges and other trading platforms used by Hong Kong people do not have any operation organization in Hong Kong, and their headquarters are not located in Hong Kong, they are only used by Hong Kong users.Some exchanges are not affected for the time being.。
However, as the cryptocurrency community becomes more mature and the centralized exchanges grow bigger and bigger, they will tend to cooperate with the local policies in order to expand their scale and increase the number of users.Opportunity to proactively change user functions in line with Hong Kong's legislative amendments。
OTC Off-Site Exchanges Going
Operate a virtual asset exchange, i.e., provide a service by means of an electronic facility that meets the following descriptions
- Offers to buy or sell proposed assets are often made or accepted in such a way that the making or acceptance of such offers creates a binding transaction or results in a binding transaction;
- Persons frequently introduce or identify each other with a view to negotiating or consummating a purchase or sale of a virtual asset, or frequently introduce or identify each other with a reasonable expectation that they will negotiate or consummate a purchase or sale of a virtual asset in a manner that creates a binding transaction or results in a binding transaction;
• In that service, client money or client virtual assets are held, directly or indirectly, by the person providing the service.
All OTCs do not hold clients' assets, and trading services are in the form of "buy one, sell one".Therefore, by definition, the off-market exchange may not be a good idea.。
However, OTC exchanges have been providing a lot of services."any business of virtual asset services"as well as"Advertisements for Virtual Asset ServicesSo it stands to reason that the local OTCs may apply for licenses in order to continue to do business safely.
Withdrawal Methods for Retail Traders
At present, you can continue to withdraw and deposit funds through the OTC exchange.
Coin C2C (P2P transactions do not involve Coin officials, only buyers and sellers are involved in the transaction)
・Use Wirex or Crypto.com card to withdraw money from ATMs.
If you have a foreign passport or identity card, you can withdraw funds from foreign OTC and transfer back to Hong Kong bank.
Real trading (relatively risky).
Conclusion
First of all, I would like to tell you not to be surprised, there is nothing special to be done at the moment. If the law is passed, it will come into effect on March 1 next year at the earliest, and any "Virtual Asset Service Providers" that are not licensed by the Hong Kong government will not be allowed to engage in trading activities in Hong Kong.
After understanding the content of the amendment and reading most of the information on the internet, I think that all of them are actually playing with the gray area, and are not holding the most positive play. Not only you, even I have doubts about a lot of fields after reading, mainly because its content is too many than the exchange and the related people to go out.
Let's talk about CEX such as Coin, is it actually a Hong Kong operation? This amendment is mainly targeted at local companies operating related services, and Coin has no trading or financial services in Hong Kong, but it does act as an "intermediary" to provide a C2C channel for private transactions with users. Is this stepping out of line? That's why it's a gray area.
As for OTC exchanges, I see that many local OTCs have quickly clarified that OTC is fine, although it seems that Zhengkou is trying to target large exchanges, OTCs are engaged in the cryptocurrency industry after all, so will they or will they not be able to set up their own exchanges? We'll keep an eye on it, and even if OTC doesn't take the initiative to apply for a license, we can't rule out the possibility of Cheng Kou's taking the initiative to mess with it.
OSL and Hashkey have their own licenses, but it was revealed earlier that the top management is a former SFC officer. It seems that they don't want to get a share of the market from retail investors.
To summarize, there are too many grey area definitions, we should always pay attention to the major exchanges and the OTC announced news, see what they will take action, the problem of withdrawals is not too big, and there is a lot of room to go to the future than everyone to live, and do not need to worry too much.
At this stage, everyone is just analyzing the possible wilds according to the words, it is meaningless to estimate and affect the mood after that.