Hong Kong launches retail-friendly rules for crypto exchanges

Hong Kong has introduced new rules for cryptocurrency exchanges, which permit licensed crypto firms to cater to retail customers, in an effort to establish ground rules for crypto and provide investor protection. The regulation, which requires exchanges to vet their clients, restrict trading to “large-cap” tokens such as bitcoin and limits investors to spot trading, comes into force after a year-long transition period. Hong Kong’s market appeal could be affected because platforms are barred from offering stablecoins, staking products and derivatives. Hong Kong had HKD1.7bn ($217m) lost to crypto-related scams last year.