Bitcoin Price Chart in Hong Kong Dollar
Bitcoin Market Capitilization
Bitcoin in Hong Kong
Bitcoin is currently not regulated in Hong Kong. In 2013, Norman Chan, Chief Executive of Hong Kong Monetary Authority (HKMA) stated that bitcoin is just a virtual commodity. He also advised that bitcoins will not be regulated by HKMA. But bitcoin usage locally and its development overseas will be monitored.
In 2014 the Secretary for Financial Services sand the Treasury informed the Hong Kong Legislative Council that, “Hong Kong at present has no legislation directly regulating bitcoins and other virtual currencies of [a] similar kind. However, our existing laws (such as the Organised and Serious Crimes Ordinance) provide sanctions against unlawful acts involving bitcoins, such as fraud or money laundering."
Also in December 2014, Legislator Christopher Cheung representing the Financial Services asked the legislative Council, “Will the Government state its position on the Bitcoin clearly and openly, so that the industry can have something to go by?”
John Tsang defined Bitcoin as “a commodity generated in the cyber world” and “neither electronic money nor a stored value payment facility.”
As Bitcoin is considered a Virtual Commodity It is not subject to any of the regulatory bodies such as the Hong Kong Monetary Authority (HKMA), Securities and Futures Commission (SFC), Financial Treasuries Bureau (FTB), the Customs and Excise Department (C&ED). Little has changed since then and it looks like it will not be in the future. In fact Hong Kong seems to be benefiting from the crackdown in mainland China on first the exchanges and now the mining of bitcoin in China. Article 112 of the Basic Law states:
“No foreign exchange control policies shall be applied in the Hong Kong Special Administrative Region. The Hong Kong dollar shall be freely convertible. Markets for foreign exchange, gold, securities, futures and the like shall continue.”
This implies it unlikely that we will ever see significant restrictions or even a “ban” on Bitcoin. The only area of interest it seems is ICO (Initial Coin Offerings) which may come under the securities regulations of Hong Kong if a particular ICO is shown to be a security Commodities Trading comes under the auspices of the Customs and Excise Department, but as Hong Kong is a Free P there are little restrictions imports and exports and no tariffs. Some financial regulatory principles such as “Know Your Customer” may continue to apply to commodities trading but no mention of trading bitcoin as a commodity has been referred to or mentioned.
A Customs and Excise Department document mentioned anyone dealing in Bitcoin may have a duty to:
- Obtain information on the customer and keeping it up to date
- Obtain information on the business relationship,
- The source of wealth and source of funds
- Monitor the business relationship
- Make reports to the Financial Intelligence Unit about suspicious activity
As previously mentioned “Initial Coin Offerings” are very likely securities and will be regarded as such and their offering to unqualified investors in Hong Kong, as in many countries, is illegal.
This is an area we will be updating as events unfold.
This article is for information purposes only and is not to be construed as financial information for any purposes such as investment or speculation and it is the responsibility of the reader to perform proper due diligence before acting upon any of the information provided. We recommend that you consult with a licensed, qualified investment advisor before making any investment decisions.