Singapore Outpaces Hong Kong in Crypto Licensing

Singapore is making strides in becoming a global crypto hub as the city-state granted 13 new crypto licenses in 2024, doubling the number issued last year. The licenses were mainly awarded to large exchanges like OKX and Upbit, as well as other firms like Anchorage, BitGo, and GSR.

Regulatory Differences Between Singapore and Hong Kong

While Singapore is signaling progress, Hong Kong has faced delays in its effort to catch up, with its licensing process moving slowly. Both cities aim to attract digital-asset firms by offering special regulatory regimes, tokenization projects, and innovation-focused sandboxes. However, Hong Kong’s regulatory regime for exchanges is more restrictive in certain areas, such as custody of customer assets and token listing and delisting policies.

“Hong Kong’s regulatory regime for exchanges is more restrictive in a number of ways that matter — such as custody of customer assets and token listing and delisting policies,”

According to Angela Ang, senior policy adviser at blockchain forensic firm TRM Labs, these restrictions may have tipped the balance in Singapore’s favor.

Hong Kong’s Cautionary Approach to Crypto Regulation

Hong Kong has fully licensed seven platforms, including four that were approved in December with some restrictions. However, exchanges like OKX and Bybit withdrew their applications without explaining the reason. Hong Kong allows only the most liquid cryptocurrencies for trading, such as Bitcoin and Ethereum, and restricts trading in smaller, more volatile tokens.

Another factor limiting Hong Kong’s ability to stay competitive in the space is the influence of China, where crypto trading is banned. Hong Kong’s special relationship with China gives it a different risk profile compared to other countries.

“Singapore’s supportive environment makes it a safe, long-term choice for a regional hub.”

David Rogers, regional chief executive at market maker B2C2, believes that Singapore’s supportive environment is a key factor in its success.

Tips for Investors and Crypto Enthusiasts

  • Stay informed about regulatory changes in Singapore and Hong Kong to make informed investment decisions.
  • Consider the differences in regulatory regimes when choosing a platform for trading or investing.
  • Keep an eye on the development of tokenization projects and innovation-focused sandboxes in both cities.

For more news and updates on the crypto space, visit Global Crypto News.

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