Digital asset exchange, OKX is steadily inching towards the acquisition of a Virtual Asset Service Provider License (VASP) in the rapidly crypto-friendly climate of Hong Kong. The territory’s favorable attitude toward crypto in 2023 has drawn around 80 firms keen on setting up a base for crypto trading services. As it stands, full-fledged licenses for retail trading services have already been issued to HashKey and OSL.
OKX’s Global Chief Commercial Officer, Li Zhikai, voiced the company’s anticipation of attaining the license as they advance negotiations with commercial banks for various services post-license in March 2024. In terms of growth projections, OKX aims to reel in between 100,000 to 200,000 users during its initial year of flouting retail services.
Banks have traditionally shown caution towards the crypto industry, treading carefully around high-risk assets. But the shifting stance from Hong Kong’s authorities last year and a clearance for the Hong Kong Securities and Futures Commission (SFC) to collaborate with web3 companies has shown progress.
Hong Kong’s ambitions to cultivate a prime environment for crypto growth have spurred rumors that it may emerge as a “test net” for mainland China, particularly in the wake of China’s sweeping ban on cryptocurrencies and related activities.
Discussing the regulatory climate, Zhikai pointed out that the China Securities Regulatory Commission is expected to instate stringent requirements for firms, scrutinizing their operational conditions closely before granting licenses.
HashKey and OSL’s early approval of VASP licenses has generated considerable interest in the crypto market, especially with HashKey unveiling its $100 million fund last week. The altcoin-based fund, holding less than 50% in Bitcoin and Ethereum, has reportedly drawn high-net-worth individuals across Asia.
While these two firms have taken the lead, other rivals like Houbi and Gate.io, are not far behind. Like OKX, they too seek regulatory endorsement to offer retail services in Hong Kong. All firms in pursuit of licenses are required to have insurance and compensation arrangements in place, and hold a hefty 98% of their assets in cold wallets.
OKX, in a parallel development, has plans to penetrate the Indian market in an effort to broaden its wallet services throughout Asia. As the rest of the year unfolds, Zhikai emphasized the need to educate, enlighten, and build trust among investors. OKX’s collaboration with Premier League side Manchester City also endorses the growing rapport between traditional institutions and the crypto industry.
Source: Cryptonews
