Hong Kong Stock Exchange: Current Regulations Ought to Apply to Blockchain

HKEX wants the fintech corporations including those concentrating on blockchain and digital money to be controlled under the present monetary laws.


A report that was released on Oct. 18, by the chief economist of HKEX, investigated the ability of blockchain technology in areas such as finance. The primary reason was to provide a summary of blockchain and its uses in trading and executing payment transactions.

Developing technologies like blockchain may be integrated in the area of trading, clearing and investment. Additionally, market regulations should be made as simple as possible in order to be understood by all market participants and trading corporations in the finance sector.

Firms Should Apply The Consistency Principle

Different countries can use their own regulations while using the technology to execute transactions. However, it is advisable for these firms to apply the consistency principle in monetary regulation. Therefore, similar businesses should apply the same regulations all the time. Such a measure is aimed at bringing uniformity in the conduct of business in the industry.

The norm of consistency obligates the issuance of digital moneys and funds to operate under the current securities supervisory framework.

Corporations Should Comply With Disclosure Requirements

The issuance of shares to the members of the public must be done in a professional manner. Corporations should comply with disclosure requirements and follow the IPO registration process. Therefore, firms must also avoid publishing their prospectus without a guarantor. The situation can be corrected by applying these securities regulations.

Moreover, using the same monetary services under current regulations will sustain fair competition in the market. The measure will also ensure that activities flow smoothly in the market.

The market participants had some reservations involving fintech. They thought that its fast-changing nature can expose this platform to regulatory problems. Therefore, rules should be amended regularly because of technological advancements in the industry.

The report was released after Action Task Force revealed its intention to introduce regulations for international digital money next year. The entity is a global watchdog that supervises the cryptocurrency business.

The latest developments will force any company that wants to participate in this market to obtain a permit and to control exchanges.

Earlier in March of this current year, HKEX was purportedly in talks with its antipodean partner, the Australian Securities Exchange (ASX). The objective of the conversation was to gain from its encounters in moving over to a blockchain settlement framework, as CoinDesk had announced earlier.

The pioneer in blockchain news, CoinDesk is a media outlet that makes progress toward the most noteworthy journalistic measures and complies with strict rules of journalistic integrity. CoinDesk is an autonomous subsidiary of Digital Currency Group, which puts resources into cryptocurrencies and cutting-edge blockchain companies.

The platform also gives investors important market information before committing their resources.

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