Crypto exchange Gate eyes Hong Kong licence even as compliance costs challenge growth

Cryptocurrency speech Gate, whose Hong Kong portion past twelvemonth pulled retired of the city's virtual plus trading level (VATP) licence application, whitethorn see applying again, but precocious compliance costs inactive airs challenges for the company, according to laminitis and CEO Lin Han.

"We recognize the volition down [Hong Kong's] policies, but they bash enforce immoderate constraints," Han said successful an interrogation connected Thursday. "After a twelvemonth of cognition [in Hong Kong], we discovered that it was hard to screen the outgo locally."

Gate had been "observing" different Hong Kong-licensed platforms' show and their quality to standard their business, arsenic it evaluated whether to reactivate its crypto speech licensing efforts successful the city, Han said.

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But the institution would "actively explore" applying for the city's forthcoming licences for virtual plus (VA) dealing services, antecedently named over-the-counter virtual plus trading services, arsenic soon arsenic the regulatory model was launched, helium said. Gate was besides looking to enactment with outgo companies by offering blockchain infrastructure services, helium added.

Gate is evaluating whether to reactivate its crypto speech licensing efforts successful Hong Kong. Photo: AFP alt=Gate is evaluating whether to reactivate its crypto speech licensing efforts successful Hong Kong. Photo: AFP>

Gate, which started successful mainland China successful 2013, was the world's third-biggest cryptocurrency speech by 24-hour trading volume, down Binance and Bybit, according to information tracker CoinGecko.

The institution was among a fig of large crypto exchanges that dabbled successful the Hong Kong marketplace betwixt 2023 and 2024 aft the city's regulators launched a mandatory licensing authorities for trading platforms. Many exited Hong Kong past twelvemonth aft a one-year grace period, which had allowed them to run portion applying for a licence.

Han's remarks offered insights into the intensive efforts required for planetary platforms to summation a morganatic foothold nether Hong Kong's regulatory model for integer assets.

He added that portion Hong Kong's marketplace was highly competitory and licensing costs were high, it was besides constricted successful some size and the scope of integer plus products that could beryllium offered.

"The world is that users person galore options extracurricular Hong Kong," Han said. "So it's precise challenging for america to supply a section work that tin person users to take america implicit overseas platforms. This is 1 of the biggest difficulties we face."