OKX Crypto Exchange Enters Final Stage of Hong Kong VASP License Application

OKX Expects Final Approval for VASP License by March 2024

OKX cryptocurrency exchange is on the verge of acquiring a virtual asset service provider license (VASP) in Hong Kong. The exchange anticipates receiving final approval for the license by March 2024.

Engaging with Banks and Preparing for Business

In a recent interview, Li Zhikai, the global chief commercial officer of OKX, stated that the exchange is actively involved in discussions with banks and is currently awaiting the issuance of the license to commence operations. OKX has already begun preparatory work, including technology integration.

Hong Kong Embraces Cryptocurrency

Hong Kong established itself as a crypto-friendly nation in 2023 and introduced a licensing framework for crypto exchanges to cater to retail customers. While over 80 crypto firms initially expressed interest in setting up offices in the country, only a handful, including HashKey and OSL, successfully obtained the necessary license to offer retail crypto trading services.

Regulatory Requirements for Crypto Exchanges

HashKey began providing retail crypto trading services to users in Hong Kong on August 28. The regulatory body in the country, the Hong Kong Securities and Futures Commission, has limited retail customers to trading only Bitcoin (BTC) and Ether (ETH) to minimize the investment risks associated with new crypto tokens. Additionally, investors are subject to a 30% cap, allowing them to invest no more than one-third of their net income.

Huobi and Gate.io have also submitted applications for retail crypto trading services in Hong Kong and are presently awaiting regulatory approval. Gate.io previously shared its experience dealing with Hong Kong's regulatory requirements, highlighting the Commission's stringent demands for virtual asset service providers. The regulator has mandated that crypto platforms offer insurance and compensation arrangements to safeguard clients. Furthermore, exchanges are required to store 98% of their assets in cold wallets.

Cointelegraph reached out to OKX for their insights on the regulatory experience and expectations in the Hong Kong retail market, but did not receive an immediate response.