OKX Seeks Hong Kong's First Virtual Asset Trading License

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Published: November 21, 2023 at 7:31 am Updated: November 21, 2023 at 7:31 am

Edited and fact-checked:
November 21, 2023 at 7:31 am

OKX, a leading global cryptocurrency exchange, has officially applied for a virtual asset trading platform (VATP) license in Hong Kong, marking its bid to become the first major player under the city’s new crypto regulations.

OKX Hong Kong FinTech, the exchange’s local subsidiary, lodged the application on November 16, as confirmed by the Securities and Futures Commission’s (SFC) website.

The move by OKX, ranked third in the world by trading volume, aligns with Hong Kong’s ambitions to establish itself as a regional crypto hub.

The new SFC rules, effective from June with a one-year grace period, mandate licensing for exchanges operating in Hong Kong and open the doors for licensed platforms to cater to retail investors.

OKX Aims to Boost Virtual Asset Trading

Lennix Lai, OKX’s global chief commercial officer, expressed enthusiasm about working with the SFC to progress OKX Hong Kong’s application and enhance the city’s status in the virtual asset sector.

The application process, part of a more comprehensive legal regime introduced in late 2022, is both lengthy and expensive, with industry insiders estimating costs could exceed HK$60 million (US$7.7 million). Despite these challenges, OKX has taken a proactive approach, preparing for the application since last year.

Other major exchanges with connections to China and Hong Kong, like HTX and Crypto.com, have also expressed their intent to obtain a VATP license. Additionally, some firms are leveraging local entities under new brands to enter Hong Kong’s crypto market, such as Binance with HKVAEX and PantherTrade, linked to Futu Holdings.

The VATP license applications so far have primarily been from smaller local exchanges. Major applicants like OKX, Binance and HTX (formerly Huobi) have roots in China but have expanded globally following regulatory pressures at home. Crypto.com, initially based in Hong Kong, now operates with its headquarters in Singapore.

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