Binance’s Hong Kong application may face rejection: Report

On Jun 8, 2023

A legal expert claimed that if Binance will be forced to suspend all kinds of its services from America then there are huge chances that Binance will struggle under the jurisdiction of Hong Kong.

BinanceUS is an American subsidiary of the Binance crypto exchange. Just a couple of days ago, the United States Securities and Exchange Commission (SEC) sued Binance, BinanceUS & also Binance CEO Changpeng Zhao (CZ) with over 13 charges.

On 7 June 2023, Gilbert NG, a licensed lawyer in Hong Kong, shared his opinion on Binance’s current legal hurdles with the American securities regulatory body.

Gilbert said that if Binance will be forced to suspend all kinds of crypto & non-crypto services from America then Binance may face some legal hurdles in the Hong Kong Jurisdictions also. In short, we can say Binance may face a struggle for regulatory approval from Hong Kong’s SFC agency.

2. US SEC actions have little impact on Hong Kong’s supervision. The United States does not have laws and regulations on cryptocurrencies, but at the same time it needs to enforce the law, so there is no certainty of supervision, Hong Kong already has clear laws Framework.
— Wu Blockchain (@WuBlockchain) June 7, 2023

On the other hand, the legal expert also said that here we should think positively as securities laws in both these two jurisdictions (US & Hong Kong) are not the same.

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Hong Kong & Crypto security tokens

This month, Hong Kong brought regulatory approval for the crypto firms to provide “retail crypto services” in Hong Kong but still, no retail investors can trade those crypto tokens, which fall under the securities asset category.

In the present time, a limited number of crypto firms are providing crypto services. Before this month, only wealthy people were able to invest in cryptocurrencies, while retail crypto trading was banned since late 2021.

Hong Kong vs China

Hong Kong is a special administrative region of China. In China, any kind of crypto activity is prohibited but in Hong Kong crypto trading is fully legal.

Since 1 June, Hong Kong’s SFC agency has been accepting applications from crypto companies to provide regulatory approval for them, so that crypto companies can operate Crypto businesses with full clarity.