Hong Kong Regulator Gives Crypto Exchange OSL Tentative Licensure Approval

Hong Kong may soon have its first fully licensed cryptocurrency exchange: OSL Digital Securities, which on Friday received a landmark approval-in-principal from the Securities and Futures Commission (SFC).

• Preliminary approvalhttps://bc.group/media/pressrelease/20200821_pr_aip_enf.pdf pushes OSL, a subsidiary of Fidelity-backed BC Group, closer to becoming one of the first exchanges licensed to offer automated digital asset trading services under the virtual asset regime SFC unveiled last November.
• Full licensure is contingent on OSL satisfying undisclosed conditions, according to Reuters. But OSL is well positioned; it was the first exchange to applyhttps://osl.com/en/in-the-news/press-releases/bcgroupsoslfirsttosubmitdigitalassetlicenseapplicationtosfcinhongkong for the license and appears to be the only one this far along.
• SFC is one of a handful of regional regulators beefing up its virtual asset oversight in response to anti-money-laundering (AML) and know-your-customer (KYC) concerns.
• The watchdog's approach to crypto now treats virtual asset exchanges much like traditional securities brokerages in terms of oversight. It is, however, an "opt-in" system.