Hong Kong’s financial regulators have decided to retain the grace period for crypto firms despite recent scandals involving fraudulent activities in the crypto sphere. The grace period allows crypto firms to continue operating without a license until June 2024, giving them ample time to comply with new regulatory standards. The Securities and Futures Commission (SFC) believes that sudden changes to the grace period could be counterproductive and destabilize the virtual asset sector in Hong Kong. The SFC has warned investors to be cautious of schemes offering unrealistically high returns and has stated that platforms like Hounax, which is involved in one of the scandals, are not regulated entities. The total number of investment-related fraud cases in Hong Kong from January to September was 4,331, resulting in losses of around HK$2.82 billion. The recent scandals involving JPEX and Hounax have exposed gaps in regulatory oversight of digital assets. The Hong Kong police have taken action against fraudulent activities, arresting individuals linked to JPEX, but no formal charges have been pressed yet. The police have advised the public to be vigilant and cautious of unsolicited investment opportunities on social media, suspicious mobile apps, and unverified websites. The SFC has also warned that platforms like Hounax employ deceptive tactics to lure investors.

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Information	Details
Geography	Asia
Countries	🇭🇰
Sentiment	negative
Relevance Score	1
People	Wong Lok-hei, Leung Fung-yee
Companies	Securities and Futures Commission (SFC), JPEX, Hong Kong Police, Hounax, SFC CEO
Currencies	None
Securities	None