Bitcoin

Hong Kong’s Securities and Futures Commission has set a minimum insurance requirement of 50% for licensed crypto exchanges handling customers’ assets.
As <a href="https://osl.com/press-release/osl-enhances-digital-asset-custody-insurance-canopius-lloyds-london-partnership/" target="_blank" rel="noopener noreferrer nofollow">disclosed</a> by OSL Exchange last week, the 50% insurance coverage minimum applies to all assets under custody. At the same time, OSL announced that it had signed a two-year partnership with Canopius, a syndicate of underwriter Lloyds of London, for an insurance policy covering 95% of its users’ assets.
HashKey Exchange, another licensed virtual asset trading platform in Hong Kong, also signed a crypto insurance <a href="https://group.hashkey.com/en/newsroom/HashKey-Exchange-OneInfinity-OneDegree" target="_blank" rel="noopener noreferrer nofollow">agreement</a> with OneInfinity on Nov. 16, 2023, with the potential to expand coverage into incidents related to “server downtime, data back-up, and load management” in the future. According to local news reports, the coverage <a href="https://hk.on.cc/hk/bkn/cnt/finance/20231116/bkn-20231116200032739-1116_00842_001.html#:~:text=%E6%A0%B9%E6%93%9A%E9%A6%99%E6%B8%AF%E8%AD%89%E7%9B%A3%E6%9C%83%E8%A6%8F%E5%AE%9A,%E7%AD%89%E5%B7%A5%E4%BD%9C%EF%BC%8C%E4%BB%A5%E5%B9%B3%E8%A1%A1%E9%A2%A8%E9%9A%AA%E3%80%82" target="_blank" rel="noopener noreferrer nofollow">guarantees</a> protection for up to $50 million to $400 million worth of users’ assets.
Since Hong Kong opened crypto trading to retail investors last August, OSL and HashKey remain the only exchanges to hold virtual asset trading licenses. There are 13 entities applying for such licenses at the time of publication. As part of licensing requirements, applicants must pass stringent due diligence checks, such as a traditional financial audit that is <a href="https://cointelegraph.com/magazine/can-you-trust-crypto-exchanges-after-the-collapse-of-ftx/" rel="noopener noreferrer nofollow">broader in scope</a> than proof-of-reserves.
Although license application fees only cost a few hundred dollars, Web3 firms are each spending <a href="https://cointelegraph.com/news/web3-firms-are-spending-up-to-25m-on-hk-crypto-licenses" rel="noopener noreferrer nofollow">as much as $25 million</a>&nbsp;to build their applications for such licenses. Most expenditures come from product development and team-building, often from zero for applicants who are traditional financial entities with no prior exposure to crypto.
Related: <a href="https://cointelegraph.com/magazine/chinas-risky-bitcoin-court-decision-is-huobi-in-trouble-or-not-asia-express/" rel="noopener noreferrer nofollow">China’s risky Bitcoin court decision, is Huobi in trouble or not?</a>

Hong Kong sets licensed crypto exchange insurance requirement to 50%

Cointelegraph

Other articles published on Jan 30, 2024

Magic Internet Money loses its sparkle as DeFi platform hacked for $6.5M

With RUT Lagging Behind SPX, These Small-Cap Stocks Have Potential

Dark web drug kingpin surrenders $150m in crypto

Top Crypto CEO and Polygon Backer Accumulating New Altcoin at $0.09—Could This be the Next Big Th...

Monthly Bitcoin ETF Tracker: Analysing Market Performance

Chainlink Price Hints Bullish Reversal! LINK Price To Record 20% Jump Soon?

Join our free newsletter for daily crypto updates!