The cryptocurrency exchange OKX is at the final stretch
of its virtual asset service provider (VASP) license in Hong Kong. The exchange is
expecting to receive the approval by March 2023. Hong Kong adopted a pro-crypto
stance in 2023 but has since been carefully regulating the industry.
In an exclusive
interview, Li Zhikai, OKX’s Global Chief Commercial Officer, discussed the
exchange’s preparations, including engaging with banks and undergoing essential
technological integrations.
Hong Kong’s journey
towards becoming a crypto-friendly jurisdiction commenced in 2023 when it
unveiled its licensing framework for cryptocurrency exchanges for retail
customers. However, only a select few platforms, including HashKey and OSL,
managed to acquire licenses to offer retail crypto trading services. The
others, like Huobi and Gate.io, await regulatory approval.
The process of obtaining a VASP license in Hong Kong
comes with its fair share of challenges. The regulatory requirement stipulates
a 30% cap on investors’ crypto investments, ensuring they do not risk more than
one-third of their net income.
Additionally, the Hong
Kong regulator has established a strict crypto asset storage protocol,
mandating that crypto exchanges hold 98% of their crypto assets in cold
wallets. Additionally, they require exchanges to provide insurance and
compensation arrangements to safeguard clients’ interests.
In July, Finance
Magnates reported that
OKX had gained more than 10,000 new users in a month. The exchange established
its Hong Kong entity, OKX
Hong Kong, in March 2023, with the aim of obtaining a VASP license and
operating as a virtual asset trading platform within the city.
Hong Kong’s decision to
open the doors to retail investors garnered significant interest, with more
than 80 foreign and Mainland China’s crypto companies expressing their intent
to establish a presence in Hong Kong and acquire local licenses, Finance
Magnates reported. Among them are companies like Gate.io, Huobi, CoinEx, and
Interactive Brokers.
OKX’s Expanding Global
Footprint
Besides that, OKX has obtained licenses in other
jurisdictions globally as part of its plans to expand its reach. OKX obtained
a Minimal Viable Product (MVP) license from the Dubai Virtual Assets Regulatory Authority (VARA) in June. The
licensing…
