Hong Kong’s crypto exchange licenses are now costing applicants less million dollars, a change from the $25 million price in 2023. Livio Wang, COO of HashKey Group, clarified that the cost is several million USD, which is tens of millions in Hong Kong dollars.
Wang explained that the costs vary between the preparation and the operation stage. Established entities like HashKey, the investment in the entire exchange sector has reached tens of millions of dollars. However, platforms still in the licensing stage are expected to incur lower costs.
Since June 1, Hong Kong regulators have enforced a strict regime, expelling all unlicensed crypto exchanges and threatening criminal charges for noncompliance. Currently, only HashKey and OSL are fully licensed, while more than 11 firms hold to be licensed status.
Also Read: 11 Crypto Exchanges in Hong Kong Closer to Securing Permits
The regulations have caused the withdrawal of license applications by some exchanges, including OKX, Gate, and Huobi which has caused market reactions. Nevertheless, HashKey Exchange has been able to grow $500 million of user funds and handle a cumulative trade volume of $440 billion. The number of activated customers surged by 267% in a week.
In April, HashKey launched a global exchange in Bermuda for international users, avoiding Hong Kong, China, the US, and other regions following the collapse of JPEX, an unlicensed exchange that defrauded investors of $166 million in 2023.
Moreover, Hong Kong’s financial authorities have committed to a new era of virtual asset supervision under the Anti-Money Laundering and Counter-Terrorist Financing Ordinance (AMLO). Institutions without a “Virtual Asset Service Provider” license are now prohibited from operating in the city.
Hong Kong’s pivot towards becoming a crypto hub aims to balance investor protection with the digital asset market. Some of the measures in the city are aimed at comparing it with Dubai or Singapore as the major digital asset hub. This emergence sets Hong Kong as a possible vicinity to the wealth of mainland China, although the latter has outlawed crypto trading.
